Trump changes his statement to 'let Walsh decide interest rates on his own', as soaring US bond yields put pressure on the new Federal Reserve Chairman BlockBeats reported that on May 20, the yield of 30-year treasury bond bonds of the United States rose to the highest level since 2007 due to the impact of the war between the United States and Iran on energy prices, the selling of US bonds and fiscal deficit concerns, and the market's concern about inflation and high interest rates continued to rise. Kevin Walsh, who is about to be sworn in as Federal Reserve Chairman this week, is facing multiple pressures: on the one hand, the White House has continued to demand interest rate cuts, and on the other hand, most officials within the Federal Reserve tend to maintain high interest rates. In his latest interview, Trump stated that he would "let Walsh do what he wants," calling him "very talented. But just last month, Trump publicly stated that he would be disappointed if Walsh didn't cut interest rates immediately after taking office. Analysts believe that this statement means that the White House has begun to "leave a way forward" for not cutting interest rates in June. Economist Derek Tang said that Trump seems to be aware that the Federal Open Market Committee (FOMC) jointly decides on the Fed's interest rate decisions, rather than the chairman making decisions alone. This has provided some buffer space for Walsh in the early stages of his tenure at the Federal Reserve. Currently, there has been a significant decrease in support for short-term interest rate cuts within the Federal Reserve. With the rise in energy prices and the resurgence of inflationary pressure in the United States, the labor market has also remained stable, and market expectations for interest rate cuts within the year continue to cool down. Former Federal Reserve economist Julia Coronado said, "Currently, there is almost no evidence of deflation, and the war will further worsen the fiscal situation. The path to interest rate cuts may require a recession first." Michael Feroli, Chief US Economist at JPMorgan Chase, also pointed out that in the current environment, it will be more difficult for Walsh to push the committee to support interest rate cuts within the year. In addition, outgoing Powell is expected to remain on the Federal Reserve Board, which the market believes will also limit the space for Walsh to quickly reshape policy direction. [Original link]