"Absolutely dovish" Haskett is abandoned by Trump, with expectations of rate cuts in 2026 significantly shrinking

By the end of 2026, the probability of no rate cuts throughout the year is 11.8%, the probability of a total of 25 basis points in cuts is 30.3%, and the probability of a 50 basis points cut is 32.1%.
Based on current information, the market is engaging in a fierce expectation game regarding the Federal Reserve Chair nomination and monetary policy path for 2026. Trump hinted that he might not nominate Haskett, and this statement directly impacted the pricing in the interest rate futures market, causing traders to quickly reduce their bets on rate cuts in 2026. This reflects several key points: the immediate influence of political signals on financial markets, and the market’s deep concern over the Fed’s future policy independence and direction.

Haskett was previously seen as an "absolutely dovish" candidate, with policy tendencies highly aligned with Trump’s desire to accelerate rate cuts and stimulate growth. Articles indicate that if he takes office, the market expects the monetary policy framework to shift toward a more aggressive easing path, which could lead to systemic reevaluation of the yield curve, asset pricing models, and cross-market liquidity structures. Trump’s ambiguous current remarks are effectively using personnel uncertainty as a tool for managing policy expectations, indirectly adjusting market bets on forward rates to prevent overly premature easing expectations.

From a crypto market perspective, this expectation shift is particularly significant. Bitcoin and cryptocurrencies, as highly liquidity-driven risk assets, are largely tied to the global dollar liquidity conditions. If the rate cut expectations in 2026 "shrink," it implies the market is beginning to price in a longer-term high-interest environment or a slower easing cycle, which could suppress risk asset valuations and increase the attractiveness of cash-like assets. The previous divergence in institutional Bitcoin price forecasts essentially reflects differing judgments on the dollar liquidity cycle.

It is worth noting that although political statements cause short-term market disturbances, Fed policy ultimately depends on economic data. Short-term rate expectations will be affected by event-driven volatility, but the long-end pricing anchor remains inflation, employment, and growth trends. Therefore, the current market adjustment in probabilities for 2026 is mainly a sentiment response; the actual policy path will depend on the final nomination and subsequent economic data confirmation.

In summary, this event reveals the tension between monetary policy and political demands in the post-cycle era, and also reminds market participants that during leadership transitions in central banks, expectation frictions and volatility will become the norm. Caution should be exercised regarding policy signals, while avoiding over-interpretation of short-term news, and more focus should be placed on structural economic indicators and substantive liquidity changes.