What if the Fed cut rates to just 1% like Trump wants? An analyst says it's 'ludicrous' and may scare businesses

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• The federal funds rate currently sits at 4.25%-4.50%, but President Donald Trump has said it should go down to just 1%. A rate that low would boost inflation expectations and send long-term Treasury yields higher, but also send a signal that something extreme may be developing in the economy, according to a Wall Street analyst.

Amid the White House’s unrelenting pressure campaign on Federal Reserve Chairman Jerome Powell, President Donald Trump has not only demanded that the central bank to cut rates but to lower them all the way to 1%.