Federal Reserve expected to stand pat on rates even as Trump demands cuts

Fed officials, led by Chair Jerome Powell, have cut their rate for three meetings in a row, to about 4.3%, from a two-decade high of 5.3%. Yet with several recent economic reports showing healthy hiring and some progress on inflation, policymakers have said that the pace of rate cuts will slow this year. Some have suggested that few reductions are needed at all.

While the two-day meeting that ends Wednesday may be uneventful, it nevertheless kicks off what is likely to be a turbulent year for the Fed. President Donald Trump, last Thursday, made clear he expects to comment on interest-rate policy and said, “I know interest rates much better than they do.”

At the same time, Fed officials are also navigating a delicate period for the economy: They want to keep borrowing costs high enough to push inflation back to their 2% target, without keeping them too high for too long and plunging the economy into a recession.

The last time he was in the White House, Trump threatened to fire Powell, whom he appointed in late 2017, but he has more recently backed off such threats.

Powell’s term as chair ends in May 2026, when Trump can name a replacement. Until then, Trump’s comments Thursday suggest he expects to regularly second-guess the Fed in public, despite a decades-long tradition among previous presidents of taking a hands-off approach to the central bank.

Bay Area’s Perplexity seeks TikTok stake

Perplexity AI submitted a bid to TikTok parent ByteDance Ltd., to merge with its U.S. operations and create a new entity, according to a person with knowledge of the matter.

The structure would allow most of ByteDance‘s existing investors to retain their stakes, according to CNBC, which cited a person with knowledge of the situation, and reported on the bid earlier Saturday.

Representatives for Perplexity and TikTok declined to comment.

Finding a buyer for TikTok presents a challenge, not just because ByteDance has balked at the idea of selling but because of the expected price tag. Few companies or individuals could likely afford TikTok, which is estimated to be worth as much as $50 billion.

Perplexity AI, an artificial-intelligence search-engine startup, started 2024 with a roughly $500 million valuation and ended the year worth about $9 billion, CNBC said.

New player in U.S. Steel-Nippon takeover

An asset manager is seeking to quash Nippon Steel’s takeover of U.S. Steel and oust the leadership of the U.S. steelmaker after taking a stake in the company.

Ancora Holdings Group, with $10 billion in assets, reported acquiring a 0.18% stake in the Pittsburgh company. It said Monday that U.S. Steel CEO David Burritt and the company’s board have prioritized a sale to Nippon because they stand to receive more than $100 million if it goes forward.

President Joe Biden blocked the nearly $15 billion acquisition this month — affirming an earlier vow to prevent the acquisition of Steeltown USA’s most storied steel company.

But the deal is not dead yet. The deadline to unwind the proposed takeover was extended by the Biden administration and this month U.S. Steel and Nippon challenged the Biden decision in a federal lawsuit.

Ancora is seeking an independent slate of directors at U.S. Steel and new CEO that are committed to walking away from the Nippon deal.

Compiled from Associated Press and Bloomberg reports.