Phelan Warns Against Fed Rate Hike Citing Declining Inflation Rates

White House Adviser Phelan has expressed his opposition to a potential Federal Reserve rate hike, citing recent inflation data as the reason for his stance. The Federal Reserve is set to announce its rate decision today, and Phelan's comments come at a time when President Donald Trump has been pushing for lower interest rates.

In an interview with CNBC, Phelan pointed out that inflation has trended lower over the past three months, citing every major gauge, including the Consumer Price Index (CPI) and the Personal Consumption Expenditures (PCE) index. He noted that the Fed held off on raising rates months ago when inflation ran hotter, making a hike now harder to justify.

A rate hike would move policy in the opposite direction of what Trump has publicly favored, with the President calling for interest rates to be lowered to 1%. Phelan's comments also come as Bitcoin faces rising odds of a Fed hike this week, with traders pricing in a headwind for risk assets.