Trump "Assassin" Milan advocates for a 125 basis point rate cut, market questions the independence of the Fed being compromised.

Wall Street has always been keenly focused on every word from the Federal Reserve (FED), but the turmoil stirred by this dot plot in September 2025 far exceeds the past. Although the Fed announced a "risk control" rate cut of 25 basis points and hinted at two more cuts within the year, which seemed moderate, it triggered a frenzy on Wall Street due to an abrupt expectation of "125 basis points." The market unanimously believes that this extreme prediction comes from "Trump's Federal Reserve assassin" — White House economic advisor Stephen I. Miran, raising serious doubts about whether the independence of the Federal Reserve (FED) has been influenced by the White House.

Pixel graphics anomaly: A committee member advocates for a radical interest rate cut of 125 basis points

(Source: FOMC)

The latest resolution has lowered the target range for the federal funds rate to 4.0%-4.25%, marking the first rate cut since December 2024. According to the dot plot released by The Federal Reserve (FED), the median indicates another two rate cuts within the year; the futures market shows a probability of over 70% for rate cuts in October and December, with expectations on both sides almost overlapping.

However, a deeper analysis of the bitmap reveals serious internal divisions:

· Among the 19 voting members, 9 are inclined to lower rates once more or less.

· Another 9 members advocate for 2 rate cuts, showing a clear tug-of-war.

· The most striking point is an isolated point, indicating that a committee member advocates for a radical interest rate cut of 125 basis points within the year.

This extreme forecast is widely believed to originate from "Milan", and the reasonable speculation is not surprising. Regarding whether to cut interest rates in the conclusion of the September meeting, the voting result was 11 to 1, with only Stephen I. Miran dissenting, advocating for a 50 basis point cut, while others expressed a preference for a 25 basis point cut, which also reveals Milan's eagerness to lower interest rates.

"Trump Assassin" parachutes into The Federal Reserve (FED), immediately demonstrating influence

Although no direct evidence has been found to prove that any committee member is receiving political directives, the market has already labeled the expectation of 125 basis points as "Trump's assassin," accusing the White House of influencing the Fed through personnel changes. Trump has indeed criticized Powell in the past for the slow pace of rate cuts and has influenced the composition of the board through his nominations.

What is more striking is that Milan participated in the September FOMC voting meeting just a few days after taking office, and immediately displayed a position that was markedly different from that of other committee members. While this situation is a normal political tug-of-war, it coincides closely with the timing of the extreme values appearing in the dot plot, raising concerns in the market about the independence of The Federal Reserve (FED).

In response to these doubts, Powell reiterated at the press conference that "the Fed relies on data and is not influenced by government directives," loudly defending its independence, effectively keeping the notion of being a "killer" at bay.

Predictions for 2026 Show Greater Divergence: The Federal Reserve and the Market Have Gone Their Separate Ways

If we push the timeline to 2026, the divergence between the Fed and the market becomes more apparent. The median in the dot plot only expects one more rate cut, but the market's futures prices have already implied three rate cuts. There are two main reasons behind this divergence:

1. The unemployment rate in the United States has risen to 4.3%, indicating a clear weakening of the labor market.
2. Core PCE remains stuck around 3%, above the 2% target, making decision-making for The Federal Reserve (FED) significantly more difficult.

In addition to the change in leadership at the Fed in 2026, and the possible personnel arrangements by the Trump administration, the interest rate curve is filled with political noise. The market is concerned that as more "Trump loyalists" enter the Federal Reserve, future monetary policy may lean more towards political considerations rather than purely economic data.

How Investors Interpret: The Median Rule Fails, Insights from Extreme Values

From an operational perspective, investors face several key challenges:

1. Distinguishing extremes from trends: The median tells you the baseline scenario, while extremes reveal stress tests—once inflation falls rapidly or employment deteriorates, the Fed may be forced to take unexpected actions.
2. Uncertainty of the 2026 Committee Reshuffle: High-level personnel changes will bring significant variables to the direction of policies.
3. Political risk has entered the interest rate curve: Although difficult to quantify, political factors have become part of market pricing.

The pixel map is not just a set of points, but a projection of the three forces of policy consensus, data reality, and political pull. That isolated point of 125 basis points, although the Fed's actions this time are cautious, foreshadows the bumps on the future path.

For investors, understanding data, identifying noise, and continuously examining whether the independence and resilience of the Fed exists will be the most important risk management lesson in the next 12 months. As political factors increasingly influence monetary policy, market volatility may further intensify, and investors need to more cautiously assess the direction of interest rates and their impact on various asset classes.