Pricing the Next Move
What has President Trump said this week?
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What has President Trump said this week? 〰️
1. Trump Approves Advanced Chip Sales to China
President Trump has approved the sale of Nvidia’s advanced H200 artificial-intelligence chips to China, marking a partial easing of U.S. export restrictions on high-end semiconductors. According to Bloomberg, the approval permits shipments under specific licensing conditions and follows direct discussions between Trump and Chinese President Xi Jinping, framing the move as a negotiated adjustment rather than a broad rollback of export controls (Bloomberg, 2025). Trump has emphasized the economic benefits for U.S. companies while stating that national security safeguards will remain in place.
The decision carries significant commercial implications. China represents a large share of global demand for AI computing hardware, and renewed access could support Nvidia’s revenue growth while reinforcing the position of U.S. firms in the global AI supply chain. At the same time, the administration is pursuing a calibrated approach, allowing sales of certain advanced chips while maintaining restrictions on other technologies and subjecting exports to enhanced end-use monitoring (BBC, 2025).
Security and technology risks remain central to the debate. Critics warn that even licensed sales of advanced AI chips could enhance China’s military or surveillance capabilities, while supporters argue that strict bans accelerate China’s development of domestic alternatives (The Times, 2025). Key uncertainties include whether approvals expand to additional products, how durable the policy shift proves to be, and whether congressional or regulatory pushback could reintroduce volatility into the semiconductor sector.
2. The Fed’s Future: Leadership, Independence, and Rates
President Trump commented on the Federal Reserve’s most recent interest-rate cut, expressing the view that rates could move lower more quickly to support economic growth. His remarks have drawn renewed attention to the Fed’s leadership and the broader discussion over the appropriate degree of White House engagement with monetary policy (CNBC, 2025). Fed Chair Jerome Powell has reiterated that policy decisions are guided by economic data, while the exchange highlights the increased visibility and sensitivity of interest-rate policy amid slowing growth.
Leadership dynamics are now central to market interpretation of Fed actions. The Federal Open Market Committee has cut rates by 25 basis points for a third consecutive meeting, but Powell’s term ends in May, making this one of his final scheduled decisions as chair (Investopedia, 2025). Recent reporting indicates that discussions around his successor are intensifying, with figures such as Kevin Hassett and Kevin Warsh mentioned as potential candidates who may favor a more accommodative policy stance (Fortune, 2025). As a result, investors are increasingly weighing the views of potential future leadership alongside official Fed guidance.
This transition is already affecting expectations. While Fed officials project only a single quarter-point cut in 2026, futures markets are pricing in two cuts, reflecting assumptions that a Trump-appointed chair could push for easier policy (Investopedia, 2025). The outlook is further complicated by delayed inflation and employment data due to the government shutdown, limiting the Fed’s visibility into current economic conditions. For markets, the combination of leadership uncertainty, incomplete data, and political pressure has sharpened concerns around central-bank independence and credibility (New York Times, 2025). Even before any formal change, perceptions about future governance are influencing bond yields, the dollar, and rate expectations heading into 2026.
3. The Anticipated Jobs Report
The latest U.S. jobs report, released after delays caused by the government shutdown, pointed to slower job creation and a rising unemployment rate compared with earlier in the year. In November, the economy added 64,000 jobs, while unemployment climbed to 4.6%, a four-year high, according to the Bureau of Labor Statistics. The figures followed a revised loss of 105,000 jobs in October, confirming that hiring momentum has cooled after several years of strong labor-market gains (CNN, 2025; Bloomberg, 2025). While the data do not signal a sharp downturn, they indicate that employers are becoming more cautious amid higher borrowing costs and ongoing economic uncertainty.
For households and the broader economy, the slowdown carries mixed implications. Slower hiring may help ease inflation pressures by moderating wage growth, supporting the Federal Reserve’s recent rate cuts. At the same time, fewer job openings and higher unemployment could weigh on consumer confidence and spending, particularly among lower-income households that are more sensitive to labor-market shifts. Most economists describe the current environment as a normalization toward a more balanced labor market rather than the start of a recession (CNN, 2025).
Financial markets reacted quickly. The U.S. dollar weakened as investors interpreted the report as increasing the likelihood of additional rate cuts in 2026, which would narrow the U.S. interest-rate advantage over other major economies (CNBC, 2025). Expectations of lower rates tend to reduce support for the dollar, underscoring how labor-market trends are influencing currency markets and global capital flows.