Commerzbank discusses the issue of the independence of the US Federal Reserve's decisions following Trump's victory.

Foreign exchange expert at Commerzbank, Antji Brayfek, stated in a research note that the U.S. elections will not change anything for the Federal Reserve's policy in the short term, arguing that the central bank will continue to make decisions regarding its monetary policy independently of the known outcome.

The economist added that the Federal Reserve's mission regarding high inflation is nearing its end; this coincides with the centrality of discussions about labor market conditions, but generally, there are no signs of recession; the labor market is just weakening slowly.

He further explained that the unemployment rate has risen moderately, along with a gradual decline in new job creation, so the Federal Reserve can confidently cut the main interest rate to become less restrictive.

There are also good arguments for the Federal Reserve to proceed cautiously at this time and not consider any major options to cut rates by more than 25 basis points.

After all, economic growth proved to be very resilient in the third quarter; this coincided with a halt in the recent decline of core inflation, which calls for a cautious approach by the Federal Reserve and adopting cuts of only 0.25% at the December meeting.

Regarding the independence of the Federal Reserve's decisions following Donald Trump's election as president; markets have reacted very sensitively to any attacks on the Federal Reserve's independence, even if it is only through verbal statements, which Trump will certainly make loudly.