The Fed vs. Liquidity: A Tug of War

While Canada ends QT and cuts rates-alongside the ECB-Powell, on the other hand, emphasized that reserves remain 'abundant,' signaling no end to QT.

As we highlighted in our weekly update, this FOMC meeting was more about Powell's rhetoric than policy shifts, and we had some insightful questions lined up.

While the Fed maintains its 'official' QT stance, Trump wasted no time criticizing both the Fed and Powell post-FOMC, arguing they've done a terrible job controlling inflation and regulating banks.

He's now preparing a fiscal dominance push, stating his intention to 'make his country financially powerful again'-which ultimately adds to liquidity.

In short: The Fed squeezes, but the Treasury greases.

‍