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Finally, the change of the head of the U.S. Federal Reserve, the "governor" (such as Jerome Powell), and the appointment of a more flexible figure who follows the White House's desires for interest rate cuts, represents a fundamental shift in global monetary policy, with complex implications ranging from temporary recovery to long-term structural risks.

Below is an analysis of what might happen to the global economy based on these factors:

1- Weakened independence of the "Fed" and international credibility

The Federal Reserve is considered the "anchor" of global financial stability. Direct political intervention may lead to:

Loss of trust: If markets feel that interest rate decisions stem from political goals (such as supporting short-term growth before elections) rather than economic data, the dollar will lose its appeal as a safe haven.

Increased cost of debt: Investors may demand a higher "risk premium" to purchase U.S. bonds, raising long-term interest rates even if the Fed lowers short-term rates.

2- The return of the specter of global inflation

Cutting interest rates at a time when inflation is still unstable (especially with Trump's tariff policies) may lead to:

An inflationary spiral: Cheap liquidity + high tariffs = sharp price increases.

Exporting inflation: Since most global trade is conducted in dollars, a decline in its value and rising inflation in America will reflect on the prices of imported goods in the rest of the world.

There is also the impact on currencies and emerging markets

An inevitable decline of the dollar, as the interest rate cut is expected to weaken the dollar, which may help developing countries with dollar-denominated debts (reducing the overall debt burden).

Funds may flow out of U.S. bonds in search of higher returns in emerging markets, temporarily but significantly boosting global stock markets.

Other countries may deliberately lower their interest rates to weaken their currencies and maintain the competitiveness of their exports against America, creating a state of monetary instability and a very fierce competitive fever.

Recovery of high-risk assets (gold and cryptocurrencies)

In a climate of uncertainty regarding the stability of the dollar, this is an expected outcome, and investors may turn to gold as a hedge against inflation and the politicization of monetary policy, with expectations of reaching record levels (some reports mention $5,000 per ounce in extreme scenarios).

Digital cryptocurrencies may benefit as a "decentralized" alternative away from government interventions in traditional currencies.

The summary of the expected impacts can be outlined as follows:

Economic growth: Short-term recovery in America followed by the risks of stagflation.

Financial markets: High volatility and strong rises in stocks and gold.

Global trade: Disruption due to fluctuations in exchange rates and protectionist policies.

Sovereign debts: Pressure on dollar-denominated borrowing countries if inflation rates rise. This move is considered a "double-edged sword," as it may prevent recession and stimulate investment, but it risks collapsing the financial system based on trust in the independence of central banks.