Trump’s Tariffs Stir Emergency Rate Cut Bets as Recession Fears Mount
Economics
Jamie Redman
Trump’s Tariffs Stir Emergency Rate Cut Bets as Recession Fears Mount
Speculation surrounding a potential emergency rate cut by the Federal Reserve has grown more fervent, fueled by escalating anxieties over an economic slowdown catalyzed by U.S. President Donald Trump’s trade battle.
Trump’s Tariffs Stir Emergency Rate Cut Bets as Recession Fears Mount
Speculators Bet on Emergency Rate
Trump’s declaration of broad tariffs targeting global trading partners has rattled financial markets, triggering a steep Wall Street downturn and intensifying recession fears. This wave of uncertainty has prompted widespread conjecture that central banks—chiefly the Federal Reserve—may resort to monetary easing to cushion the blow.
The next Federal Open Market Committee (FOMC) meeting is scheduled for May 7. According to CME’s Fedwatch tool, there is a 71.8% probability that the central bank will maintain current rates.
On Polymarket, a predictions platform, the likelihood of no change stands at 75%, while Kalshi’s prediction market similarly indicates a 75% chance that rates will remain steady. Polymarket is also hosting a wager on the possibility of an emergency federal funds rate cut, currently reflecting a 22% probability.
Trump’s Tariffs Stir Emergency Rate Cut Bets as Recession Fears Mount
Polymarket emergency rate cut bet.
Emergency rate cuts were last implemented in the volatile days of March 2020, at the onset of the pandemic. The current volume on Polymarket’s emergency rate cut bet sits at $320,464.
Trump’s Tariffs Stir Emergency Rate Cut Bets as Recession Fears Mount
Kalshi emergency rate cut bet.
Kalshi is offering a similar wager, though its figure is higher, with a 31% chance priced in. Before the pandemic, the previous instance of emergency cuts by the Federal Reserve occurred during the 2008 financial crisis.
Trump continues to urge the central bank to lower interest rates, contending that present economic conditions present the “perfect time” to do so.
Welcome to Billionaire Club Co LLC, your gateway to a brand-new social media experience! Sign up today and dive into over 10,000 fresh daily articles and videos curated just for your enjoyment. Enjoy the ad free experience, unlimited content interactions, and get that coveted blue check verification—all for just $1 a month!
Account Frozen
Your account is frozen. You can still view content but cannot interact with it.
Please go to your settings to update your account status.
Open Profile Settings