The Morning Edge: Trump Demands Immediate Rate Cuts, Escalating Fed Feud as Markets Wobble

QUICK SNAPSHOT
Global Sentiment: Risk-off
Factors: Trump-Powell tensions

TODAY’S WATCHLIST
 - IMF to release its World Economic Outlook
 - ECB President Lagarde speaks
 - HCL Technologies earnings

THE BIG STORY
US President Trump escalated his battle with the Federal Reserve on Monday, demanding immediate interest rate cuts to avert an economic slowdown and renewing attacks on Chair Jerome Powell as "Mr. Too Late." The outburst comes just weeks before the Fed's May 6-7 meeting, where policymakers are widely expected to hold rates steady at 4.25%-4.50% - a stance that puts them on collision course with a White House increasingly willing to challenge central bank independence.

The brewing showdown highlights the Fed's delicate balancing act: while Trump claims his tariffs have tamed inflation, Powell's committee must weigh whether trade policies might instead fuel persistent price pressures. With the May meeting likely to maintain the status quo, the central bank finds itself navigating not just economic crosscurrents but a constitutional crisis in the making - one that could redefine the boundaries between monetary policy and political power in an election year.

DATA
Americans' wage expectations for new jobs fell sharply in March, with the average "reservation wage" dropping to $74,236 —down nearly $82,135—according to the New York Fed's Survey of Consumer Expectations. The decline was driven primarily by men and workers over 45, alongside broader erosion in job satisfaction, with pay contentment hitting a 28-month low. The data aligns with recent surveys showing heightened consumer anxiety over trade wars and inflation, as economists increasingly flag recession risks amid Fed warnings of slowing growth. 

WHAT HAPPENED OVERNIGHT
US stocks plunged Monday, with all three major indexes dropping over 2%, as Trump’s renewed attacks on Fed Chair Powell rattled investor confidence in central bank independence. The selloff was led by mega cap tech stocks, with Nvidia sinking 4.5% on reports of Huawei’s rival AI chip launch and Tesla tumbling 5.8% due to Model Y production delays. 

Longer-dated US Treasury yields surged Monday, with the 10-year note jumping 8.8 bps to 4.415% and the 30-year bond spiking 10bps to 4.909%—its highest since January—as Trump’s renewed threats against Fed Chair Powell fuelled a selloff.  The US dollar index plunged to a three-year low of 97.923 on Monday as Trump’s escalating attacks on Fed Chair Powell—calling him a “major loser” and demanding rate cuts—sparked fears over central bank independence. 

Brent crude oil prices dropped sharply on Monday, with Brent crude falling 2.5% to $66.26 a barrel, as signs of progress in US-Iran talks eased supply concerns. 

Day’s Ledger
Economic Data

• Japan core CPI data
• UK S&P Global consumer sentiment index  
• US Johnson redbook retail sales for the week ending April 19

Corporate Actions

• January–March earnings will be announced by: HCLTechnologies, Mahindra & Mahindra Financial Services, Choice International, Cyient DLM, Hathway Cable & Datacom, Huhtamaki India, Mahindra & Mahindra Financial Services, Sampann Utpadan India, Sanginita Chemicals, Waaree Energies, AU Small Finance Bank, Delta Corp, Havells India, Tata Communications, and Vardhman Special Steels
• 360 ONE WAM will consider the issuance of warrants.
• Deccan Bearings will consider raising funds via equity shares or other equity-linked instruments.

Policy Events

• Annual government deficit and debt data to be released by the European Union
• G24 Ministers and Governors' Meeting to be held in the US
• IMF to release its World Economic Outlook in the US
• IMF to also release the Global Financial Stability Report in the US
• ECB President Lagarde speaks
• ECB's De Guindos speaks
• US FOMC Member Kashkari speaks 
• US Fed Governor Jefferson speaks
• US FOMC Member Harker speaks  

TICKERS

• BRIGADE GROUP signs JDA for 20-acre plotted project in East Bengaluru
• COAL INDIA signs pact with DVC for ₹165 bln thermal power project 
• Delhi High Court issues notice to CCI on NRAI plea for probe documents on ETERNAL, SWIGGY
• PAYTM MONEY cuts MTF rate to 9.75% for small, large investors
• TATA POWER, TATA MOTORS to co-develop 131-MW hybrid renewable project
• TATA INVESTMENT Jan-Mar net profit falls marginally; revenue drops 7.2%
• VEDANTA promoter group firm Twin Star Holdings signed a $530 million Facility Agreement to service VRL Group debt and general purposes. 
• HG INFRA ENGINEERING declared a qualified bidder by Gujarat Urja Vikas Nigam for 300 MW/600 MWh of standalone battery storage in Gujarat, part of a larger 500 MW/1000 MWh project.
• GANDHAR OIL REFINERY (INDIA signed a non-binding MoU with Jawaharlal Nehru Port Authority to develop a cargo terminal at Vadhvan Port. 
• GUJARAT ALKALIES AND CHEMICALS dispatched first Benzyl Chloride consignment from its new 30,000 TPA Chlorotoluene plant at Dahej. 

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• RBI Finalises LCR Norms; Lowers Run-off Rate for Digital Retail Deposits
• BOJ sees little need to change basic rate hike stance