Trump Hopes Warsh’s Fed Nominee to Cut Rates; FOMC Officials Signal Stasis Until Inflation Yields

U.S. President Trump seeks further rate cuts under his nominee for Fed chair, Kevin Warsh, following his May swearing-in, but two officials with this year’s voting authority warn policy may stall. Cleveland and Dallas Fed presidents Beth Hammack and Lorie Logan said persistent inflation and the lag in easing effects suggest further rate reductions could harm economic growth. “Rather than attempt a fine-tune to the federal funds rate, I would prefer patience,” Hammack said, noting the Fed may keep rates unchanged for an extended period. Hammack and Logan, FOMC voting members, could block moves diverging from current Chair Jerome Powell or from Powell and Warsh. Powell’s term expires in May, and Warsh’s nomination is still awaiting congressional approval. Wall Street traders expect the Fed to keep policy unchanged at its March meeting, but a rate cut before May is about 50-50.