Trump "blasts" Powell, the dollar plummets, and Bitcoin rises above $87,000

The market is driven by macro news.

On April 17, Federal Reserve Chairman Powell delivered a speech at the Economic Club of Chicago. In his speech, Powell clearly released neutral and hawkish expectations. He admitted that the uncertainty of the potential impact of tariff policies is increasing. It can be foreseen that inflation will rise and economic growth will slow down, which puts the Federal Reserve in a dilemma. However, for the first time, he opposed the market rumor that "the Federal Reserve will become the last person to back it up", saying bluntly that "the Federal Reserve has no need to intervene in the market and will not consider cutting interest rates for the time being. The market's expectation that the Federal Reserve will take action to calm volatility may be wrong."

This is not the first time that Trump has said this. As early as in his first term, he had many conflicts with Powell because Powell never cooperated with the interest rate policy that was consistent with his philosophy. It was also revealed that he had privately discussed the possibility of firing Powell in his first term. Now, with tariffs having a visible impact on global stock markets and the economy, Trump's administration needs the cooperation of the Federal Reserve more than ever before, but Powell's attitude seems to still be dismissive of it, which makes Trump, who is increasingly concentrated in power, even more dissatisfied, and the conflict is imminent.

With the blessing of the two-way incident, gold has soared. The international gold price continued to rise, with spot gold hitting a record high of

The Federal Reserve Bank refers to the 12 regional Federal Reserve banks under the Federal Reserve system, and the FOMC is relatively familiar, also composed of 12 members, including 7 members of the Federal Reserve Board, the President of the Federal Reserve Bank of New York, and the 4 rotating presidents of the remaining 11 regional Federal Reserve banks. FOMC is one of the main decision-making bodies of the Federal Reserve, responsible for formulating the monetary policy of the United States, and making decisions by voting. It is worth noting that the decision of the Federal Reserve's interest rate meeting must be agreed by at least 7 votes.

It is precisely because of the above measures that the market speculates that these two judgments may be a test for Trump to overthrow Powell. However, the Federal Reserve also stated that the above rulings do not apply to the Federal Reserve because the National Labor Relations Board is a committee under the executive branch.

Of course, don't underestimate Trump, which is the current global consensus. What consequences will it bring if Powell is replaced? The impact will be very wide. JPMorgan Chase said that the market may face "1970s-style stagflation risk", causing long-term interest rates to soar. Deutsche Bank also believes that this will be more destructive than the ongoing tariff trade war, and the US dollar may plummet by 3%-5% in the short term. This is also an important reason for the rise of gold and Bitcoin. Both are currently in the same risk-averse narrative. From the current encryption market alone, waiting and watching has become the mainstream. The market trading sentiment is quite depressed. BTC turnover rate reached the lowest level in recent years yesterday. As of April 20, the average seven-day trading volume of global crypto exchanges fell to about US$32 billion, the lowest since October 2024, and a plunge of more than 75% from the high point in December 2024. However, it is worth noting that on-chain data shows that despite the decline in Bitcoin prices from March to April, the number of addresses holding more than 1,000 BTC still hit a four-month high, which shows the long-term bullish sentiment of the market. From the perspective of currency prices, although there is still pressure on the upward trend, the bottom support range of US$80,000 is still very strong, and the possibility of subsequent range fluctuations is higher. If the risk aversion narrative is strengthened, the probability of continued rise cannot be ruled out.

At the core, range repair and rebound are the main themes of the current market. And as mentioned many times before, if we want to truly return to the bull market, the Fed's interest rate cut is a necessary event. Judging from the Fed's remarks, it is more concerned about inflation than labor, and the impact of tariffs on inflation is difficult to quantify in the short term. The Fedis unlikely to cut interest rates before June, and it is best to take corresponding defensive operations in the risky asset market.