What you need to know before the Fed interest rate decision

The US Federal Reserve (Fed), which cut interest rates for the first time in about 4.5 years in September, will announce the decision that the whole world is waiting for tonight.

The world, which unexpectedly survived the excitement of the US elections very quickly, was locked in the Fed's interest rate decision this time. The Fed, which lowered interest rates for the first time in years in September and unexpectedly reduced at a high rate of 50 basis points, is expected to be satisfied with 25 basis points this time.

Will the Trump effect be seen?

On the other hand, another issue that the markets are questioning is the possibility that the Fed will not surprisingly go to a discount at this meeting... The markets do not price such an option at the moment. In Fed Watch Tool, which measures expectations in futures markets, a 50 basis point discount is priced with 1% and a 25 basis point discount is priced with 99%. In other words, there is no question of passing this meeting between expectations.

As it is known, Trump was against making interest rate cuts in the autumn months. It was even claimed by the American media that Trump told Fed chairman Powell, "Don't cut interest rates until I become president and wait."

Therefore, how much Trump will affect or whether it will affect the Fed decisions will be followed with curiosity by the piays, at least after this meeting.

While the interest rates between 4.75% and 5.0% are expected to be further reduced, what the head of the institution, Jerome Powell, will say about both the interest rates and the US elections, is one of the curious topics of the night...

Powell, who is generally afraid to address political issues and states that the Fed takes decisions without being affected by the government, is expected to maintain this stance.

Powell was appointed as Trump's presidency in 2018, and after his term expired in 2022, he was once again nominated by Joe Biden, who is now president, and elected president of the institution in his second term.