The US Fed has reduced its rate under the coercion of Trump.

The latest summary of economic projection has shown virtually no change from its June's projection.

However, the dot plot chart has shown significant changes.  Let's take a look now.

A significant number of Fed members had voted for 3.75 interest rate by the end of the year.  This means that the Fed will continue to lower its rates if there is no further spike in inflation.  However, we think that it is impossible not to have a continual inflation spike because of the higher tariffs.  This really puts the Fed in a dilemma and we view this rate reduction as a political decision under Trump's duress instead of a sound monetary policy stance.