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<\/p>\nCrypto markets are confronting a fast-moving repricing of US monetary policy expectations, and macro trader Alex Kr\u00fcger argues that even after last week\u2019s sharp dovish turn, futures curves still fail to discount what a Trump-aligned Federal Reserve leadership could look like.<\/p>\n
In a post on X, Kr\u00fcger shared a CME-derived table of implied policy rates for late-stage 2026 and framed it as the market\u2019s baseline for the post-Powell transition. The table shows an expected fed funds rate of 3.47% for the April 29, 2026 FOMC meeting (347 bps), drifting to 3.29% for June 17, 2026 (329 bps), to 3.10% for September 16, 2026 (310 bps), and to 2.99% for December 9, 2026 (299 bps).<\/p>\n
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In other words, the curve prices roughly 48 basis points of easing between late April and early December 2026 about two quarter-point cuts across that span\u2014implying a relatively gradual descent toward just under 3%.
\nKr\u00fcger\u2019s core claim is that this path is inconsistent with the policy preferences he associates with the Trump camp, and therefore inconsistent with an \u201cultra dovish\u201d chair appointment. He situates the April 2026 meeting as the last one under Jerome Powell\u2019s chairmanship, whose four-year term ends in mid-May 2026, and then treats the June 2026 meeting as the first under a new chair.<\/p>\n
Against that transition, Kr\u00fcger points to Fed Governor Stephen Miran\u2014whom he casts as a proxy for Trump-world monetary instincts\u2014as advocating a much faster return to neutral. In Kr\u00fcger\u2019s telling, Miran has argued that the \u201cappropriate fed funds rate\u201d is \u201croughly 2% to 2.5%,\u201d has linked this year\u2019s tighter stance to a rise in the neutral rate, and has characterized his divergence from colleagues as centered on \u201cspeed of cuts,\u201d not destination.<\/p>\n
Kr\u00fcger also highlights Miran\u2019s preference for \u201c50 bps cuts\u201d over 25-bp steps as the way to get policy back to neutral. On Kr\u00fcger\u2019s arithmetic, a futures curve that delivers only about 50 bps of easing from the first post-Powell meeting in June 2026 through December 2026 is not a curve that has truly priced a Trump-era chair willing to front-load larger moves.<\/p>\n
Put simply, he sees the market as still anchored to a Powell-style glide path, even while political risk is skewing toward more abrupt easing. \u201cThe Trump camp wants faster and bigger cuts, many of them. The Fed only cutting 50bps between the new Fed Chair’s FOMC in June and December 2026 falls short. That’s why I sustain an ultra dovish Fed Chair appointed by Trump is not priced in,\u201d Kr\u00fcger concludes.<\/p>\n
The timing of Kr\u00fcger\u2019s warning matters because the front end has already undergone a dramatic swing. Last week, traders sharply increased the probability of another cut at the Fed\u2019s December meeting after New York Fed President John Williams said rates could fall \u201cin the near term,\u201d a remark that pushed implied odds of a quarter-point December move into the mid-70% range on CME FedWatch, up from roughly 40% the day before.<\/p>\n
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In parallel, Goldman Sachs chief economist Jan Hatzius reiterated a baseline in which the Fed cuts in December, then again in March and June 2026, taking the policy band down to roughly 3.00%\u20133.25%.\u201d We expect another Fed cut in December, followed by two more moves in March and June 2026 that take the funds rate to 3-3.25%,” said Hatzius.<\/p>\n
\nGOLDMAN SEES DOWNSIDE RISKS FOR ECONOMY NEXT YEAR<\/p>\n
Goldman Sachs economists expect the Fed to cut rates in December, followed by a few more cuts in 2025, bringing rates just above 3%. Chief economist Jan Hatzius warns the economy could slow more than expected, requiring\u2026<\/p>\n
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