Economy

Fed officials at this week’s meeting are expected to hold interest rates steady but adjust their views on the economy and possibly the future path of interest rates.
The committee could maintain its outlook for two cuts, remove one or both, or, improbably, add another as a statement of concern over a potential slowdown. Everything seems to be on the table.
Chair Jerome Powell and his colleagues in recent weeks have advocated a patient approach in which they don’t need to be in a hurry to do anything.

U.S. Federal Reserve Chair Jerome Powell testifies before a Senate Banking, Housing and Urban Affairs Committee hearing on “The Semiannual Monetary Policy Report to the Congress,” at Capitol Hill in Washington, U.S., Feb. 11, 2025. 
Craig Hudson | Reuters

Federal Reserve officials at this week’s meeting are expected to hold interest rates steady but adjust their views on the economy and possibly the future path for interest rates.
If market pricing is correct, there’s virtually no chance central bank policymakers budge from the current level of their key interest rate, targeted in a range between 4.25%-4.5%. Chair Jerome Powell and his colleagues in recent weeks have advocated a patient approach in which they don’t need to be in a hurry to do anything.

However, they are also expected to drop clues about where things go from here against the uncertain backdrop of President Donald Trump’s trade and fiscal policies. That could include anything from tweaks in projections for inflation and economic growth to how often, if at all, they expect to lower interest rates further.
“There’s no chance of a cut Wednesday, so all the other stuff becomes more important,” said Dan North, senior economist at Allianz Trade North America. “They’re basically going to say, ‘You know what, we are in no hurry at all now.'”
Indeed, that has been the prevailing message from Powell and his Federal Open Market Committee colleagues. In a speech earlier this month to economists in New York, Powell insisted “there is no need to be in a hurry” as central bankers seek “greater clarity” on where the Trump administration is headed.
New outlook for GDP, inflation, unemployment
The public, then, will be left to pore through updates the Fed makes to its quarterly projections on interest rates, gross domestic product, unemployment and inflation. Based on recent data, the Fed could raise its 2025 outlook for inflation (in December, the outlook was for 2.5% in both core and headline) while lowering its GDP projection (from 2.1%). Powell will host his usual post-meeting news conference.
On the rate question, the Federal Open Market Committee will use its “dot plot” grid of individual members’ intentions.

There’s significant disagreement on what could happen there. The committee could maintain its December outlook for two cuts, remove one or both, or, improbably, add another as a statement of concern over a potential slowdown. Everything seems to be on the table.

“I think it may be one or zero cuts this year, particularly if the tariffs stick,” North said. “I don’t think they’re going to try and bail out the economy by cutting rates, because they know that if they stoke inflation, they’re going to have to go back and start all over again.”
Economists worry the Trump tariffs could reignite inflation, particularly if the president gets more aggressive after the White House releases a global review of the tariff situation on April 2. If the Fed grows more concerned about tariff-fueled inflation, it could turn even more reluctant to cut.
Investors are right to be concerned about the direction the FOMC indicates, said Thierry Wizman, global FX and rates strategist at Macquarie.
“That worry is borne by the suspicion the Fed is not ‘in charge’ anymore, having relinquished control of macroeconomic policy to the Trump administration,” Wizman wrote. “Given the current uncertainty, and the recent increase in inflation expectations, the Fed may find it difficult to signal three more rate cuts, or even two more. It could push one rate cut into 2026, leaving only one cut in the median ‘dot’ for 2025.”
Markets still see two or three cuts
Should the Fed decide to stick with two cuts, it likely will be only “to avoid adding to recent market turbulence,” Goldman Sachs economist David Mericle said in a note.
Major stock market averages are hovering around correction territory, or 10% declines from highs.
In the past, under the idea of a “Fed put,” markets have come to expect the central bank to ease policy in response to market unrest. Traders don’t expect an initial rate reduction to happen until at least June, and are pricing in one additional quarter percentage point easing and about a 50-50 chance of a third move by the end of the year, according to the CME Group’s FedWatch measure of fed funds futures pricing.
But that might even be too ambitious, Wizman said.
“In effect, markets appear to have gotten too dovish on the Fed, and instead of signaling its own confidence in its outlook, the Fed may issue signals of no-confidence, instead. In other words, the FOMC meeting may leave many questions unanswered, as will the press conference by Jay Powell,” he said, using Powell’s nickname.
The committee also could address its “quantitative tightening” program where it is allowing a set level of proceeds from maturing bonds to roll off the balance sheet each month. Markets widely expect the Fed to end the program later this year, and recent meetings have featured discussion about how best to handle the central bank’s $6.4 trillion portfolio of Treasurys and mortgage-backed securities. More

Unlock the White House Watch newsletter for freeYour guide to what the 2024 US election means for Washington and the worldUS stocks dropped sharply on Tuesday with shares in technology groups including Elon Musk’s Tesla selling off as investors continued fretting over President Donald Trump’s economic and trade policies.The blue-chip S&P 500 ended the session 1.1 per cent lower, with nine of the index’s 11 sectors in negative territory and consumer cyclicals, which tend to fall during times of rising worries over the economy, posting some of the steepest declines.The tech-heavy Nasdaq Composite dropped 1.7 per cent, erasing Monday’s rally. Tesla slumped 5.3 per cent — extending a recent decline that has brought it down by half from its December peak — and Nvidia lost 3.4 per.The declines are the latest sign of how investors remain deeply concerned over Trump’s tariffs on America’s biggest trading partners, and their potential to slow growth and increase inflation. A Bank of America survey released on Tuesday showed investors made the “biggest-ever” cut to their US equity allocations in March.A New York Federal Reserve survey of business leaders, released on Tuesday, showed that the region’s business environment was “considerably worse than normal” as employment declined and input prices for industry increased at the swiftest pace in almost two years.A separate Fed report showed that US industrial production rose 0.7 per cent in February, far more than the 0.2 per cent increase expected by analysts. The reading should “sooth concerns that the [US] economy is on the cusp of recession”, said Bradley Saunders at Capital Economics.He warned, however, that “the drag” from Trump’s aggressive tariffs has “yet to properly take effect”, meaning there was “downside to come for [US] industry over the coming months”.Previously high-flying tech stocks have fallen more than most as investors have shifted away from riskier holdings, with an index tracking the so-called Magnificent Seven of Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia and Tesla down 17 per cent since the S&P 500 hit a record high on February 19.Traders were also bracing for the outcome of the latest Federal Reserve meeting on Wednesday. While investors are widely expecting the central bank to leave interest rates unchanged, any hints from Fed chair Jay Powell on the health of the world’s largest economy will be closely watched.The dollar fell 0.1 per cent against a basket of rivals. The currency had already erased all its gains since November’s US presidential election. More

Unlock the White House Watch newsletter for freeYour guide to what the 2024 US election means for Washington and the worldLeading academic economists are fretting not just about what the Trump administration’s policies might to do US growth and inflation. More than 90 per cent of respondents to the latest FT-Chicago Booth poll said they were very or a little worried, too, about the quality of America’s economic statistics. Concerns have mounted after an influential advisory council — the Federal Economic Statistics Advisory Committee (Fesac) — was disbanded. With thousands of pages of US government data also being altered or removed from websites, not just economists but scientists, researchers and rights campaigners are alarmed by what they see as an incipient White House war on data. Fesac, which for 25 years advised offices compiling inflation, employment and GDP data, is among five advisory councils to federal statistical agencies that were terminated by commerce secretary Howard Lutnick on February 28. A second advised on other economic data; three advised the US Census Bureau. Since they were involved in improving accuracy and effectiveness of data collection and analysis, including adapting to new trends and technology, Lutnick’s claim that their purpose had been “fulfilled” makes little sense.Lutnick also unsettled many economists when he suggested — after being asked whether spending cuts imposed by Elon Musk’s so-called Department of Government Efficiency could cause a downturn — that government spending could be separated from GDP reports. Musk, too, has said GDP would be more accurate if government spending were removed, in a departure from economic theory and international practice.Since Donald Trump returned to the White House, meanwhile, multiple data sets — on climate, crime, natural disasters, and diversity, equity and inclusion — have disappeared from federal websites. Some were deleted or modified due to directives, for example on gender ideology and orders to remove statistics on climate change. Some have fallen victim to Doge-led cuts. Some have been restored, for now, after legal rulings.Trump is not the first US president to dispute some official data or be accused of trying to skew it in his favour; some critics worry less about the extent of changes so far than about what they might portend. But this administration’s interventions already go beyond those of most predecessors. Reliable statistics are, moreover, a public good and vital national asset. The US was a pioneer of modern economic statistics, under the economist Simon Kuznets, in the 1930s and 1940s.Effective policymaking, by government agencies and central banks, as well as decision-making by investors and businesses, relies on accurate and timely data. Trustworthy statistics are vital, too, for experts and the public to assess governments’ performance.Indeed, Doge’s cost-cutting efforts might yet backfire, in a specific way. Reducing government spending is seen, in part, as a route to lowering borrowing costs. But if it reduces trust in economic data, it could raise the risk premia investors demand for buying US bonds. Attempts to curb official data tend to be associated less with democracies like the US than with authoritarian countries such as China under Xi Jinping.Some data that could prove uncomfortable for the Trump team, such as consumer confidence indices, remain beyond its control. Private sector and big tech companies could provide some substitutes for official statistics, but would not necessarily enjoy the trust previously conferred by a government imprimatur. Though economists are signalling unease on data, many investors seem more sanguine. Yet as with much else, how far the White House is willing to go may depend in part on how vocal companies and investors are prepared to be about their concerns. More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.The pound has climbed above $1.30 for the first time since early November, helped by persistent UK inflation and a broad weakening in the dollar.Sterling rose above the level on Tuesday for the first time since the days after the US election. It has climbed around 3 per cent so far this month, helped by a decline in the dollar as investors worry that President Donald Trump’s stop-start trade war is harming the US economy. Sterling’s gains mark a reversal since January, when concerns over the outlook for the UK’s public finances knocked the currency and UK government bonds. Since then, higher than expected inflation has prompted bets that the Bank of England would be slower to cut interest rates than previously thought.“The pound is along for the ride, as it has better interest rates support . . . UK fiscal concerns are still out there but on the back burner for now,” said Brad Bechtel, a global head of FX at Jefferies. After hitting a two-year high following the US election, as investors bet that Trump’s tariffs and other economic policies would boost inflation, the dollar has fallen sharply since January as investors focus more on the potential economic damage from erratic policymaking in the White House.“It sends another reminder that market participants are no longer confident that President Trump’s policies will boost US growth and strengthen the US dollar,” said Lee Hardman, senior currency analyst at MUFG. Craig Inches, head of rates and cash at Royal London Asset Management, said sterling’s strength was a combination of a “fear of US slowdown leading to more Fed cuts” versus an expected uptick in UK inflation data that will make it harder for the BoE to cut borrowing costs. In January, inflation rose more than expected to 3 per cent.The BoE is widely expected to hold interest rates steady at 4.5 per cent at its meeting on Thursday. Levels in swap markets suggest traders believe the BoE and the Federal Reserve will make two further quarter-point cuts this year, with the Fed more likely to make a third.The upward move for sterling comes despite the OECD this week lowering its growth forecast for the UK, as countries around the world are hit by the fallout from US tariffs. The Paris-based body now expects UK GDP growth for 2025 to be 1.4 per cent, a 0.3 percentage point reduction from its previous calculation.But the pound has weathered trade concerns this year, as investors bet the UK is less exposed to tariffs than some other economies. Last week, UK Prime Minister Sir Keir Starmer said he was “disappointed” by the US’s latest tariff salvo on steel and aluminium, but that the country would keep “all options on table” in terms of a response to the US administration. More

Unlock the White House Watch newsletter for freeYour guide to what the 2024 US election means for Washington and the worldDonald Trump’s chaotic trade policy can only lead to economic chaos. So, might the Trump administration stumble upon something both more coherent and less damaging, yet still meet the president’s protectionist aims? Perhaps. Some members, including Scott Bessent, Treasury secretary, and Stephen Miran, chair of the Council of Economic Advisers, believe so. If one is to understand this more sophisticated approach, one should read Miran’s “A User’s Guide to Restructuring the Global Trading System”, published in November 2024. The author states that “this essay is not policy advocacy”. But if it quacks like a duck, it is a duck. From a man in his current position, this must now be read as advocacy.Underpinning Miran’s argument is a proposition made by the Belgian economist Robert Triffin in the early 1960s. Triffin argued that the growing demand for dollars as a reserve asset could only be supplied by persistent US current account deficits. This in turn meant that the dollar was persistently overvalued relative to the requirements of equilibrium in the balance of payments.Over time, he argued, this weak trade performance would undermine confidence in the fixed dollar price of gold. So, indeed, it proved. In August 1971, in response to a run on the dollar, President Richard Nixon suspended gold convertibility. After hard bargaining, an agreement was reached on new sets of parities of the dollar against other major currencies. These did not last. Soon, these new parities collapsed. The old Bretton Woods system of fixed, but adjustable, exchange rates was replaced by today’s floating exchange rates.Miran applies this perspective to the current predicament of the US. That is why one should view what happened in the 1960s and 1970s as a better parallel to what is being discussed today than the Plaza and Louvre Accords of the 1980s. The latter were aimed at managing a floating exchange rate regime at a time of disequilibrium among the dollar and other currencies, especially the Japanese yen and German mark. What is proposed now is recreating a global system of exchange rate management.Some content could not load. Check your internet connection or browser settings.The justification for this, argues Miran, is that, as in the 1960s, the desire of most other countries to hold the dollar as a reserve currency is driving up its value and so opening a huge current account deficit. This squeezes output of tradeable goods, notably manufactures. That creates a trade-off for the US between possibilities for cheaper finance and international leverage, on the one hand, and the social and fundamental security costs of a weaker manufacturing sector, on the other. Yet Trump wants both to protect domestic manufacturing and maintain the dollar’s global role. Thus, policy has to achieve both aims.One possibility might be unilateral action by the US to weaken the dollar. An option here would be fiscal tightening combined with a monetary loosening. But that would get in the way of Trump’s desire to extend his 2017 tax cuts. Another possibility would be to force the Federal Reserve to drive down the dollar. But that might have devastating effects on inflation and the dollar, as happened in the 1970s.Some content could not load. Check your internet connection or browser settings.Yet another possibility would be tariffs alone. But, other things equal, that would lead to appreciation of the dollar, which would damage the US export sector. Therefore, implies Miran, tariffs should also be used as a weapon in bargaining for a global deal or, if deemed necessary, be complemented by such a deal.Thus, the aim of a stronger manufacturing sector, to be delivered by a combination of tariffs and a weak dollar, needs global co-operation. My colleague, Gillian Tett, has described possible details of such a “Mar-a-Lago accord”.It has two key aspects. The economic aspect is to release the constraints discussed above. The way to do so, suggests Miran, is to turn short-term borrowing into ultra-long-term borrowing, by “persuading” foreign holders to switch their holdings into perpetual dollar bonds. This would allow the US greater room to pursue its desired combination of loose fiscal and loose monetary policy. The political aspect is to point out that accepting such a deal would be the price of being viewed as a friend. Otherwise, a country would be viewed as a foe, or at best as floating in between. In a precise sense, this might be viewed as a “protection racket”.Some content could not load. Check your internet connection or browser settings.This proposal raises four questions. The first is whether Miran’s analysis of the links between the dollar’s role as a reserve currency, the chronic US current account deficit and the weakness of manufacturing employment and output is correct. One must doubt it, because the US is far from the only high-income country with falling shares of employment in manufacturing.A second is whether the proposed new currency accord would in fact allow the US to combine issuance of a reserve currency with its sectoral aims better than any plausible alternatives. A third is whether there is any likelihood of agreement with Trump on the complex set of objectives and instruments in this proposal. A final question is whether Trump is capable of sticking to any deal he has reached. He has, after all, abandoned Ukraine, put the commitment to Nato into doubt and mounted an assault on Canada. The last two points are evidently the most important. Is this administration capable of making a deal any sane person or country should trust? I think not. Yet the analysis of the economic aspects is also important. I plan to look at these next week.martin.wolf@ft.comFollow Martin Wolf with myFT and on X More

Donald Trump has spared the car industry from his tariff war against Mexico and Canada for 30 days. But for European, Japanese and South Korean car executives, it is hardly a reprieve.The US president has warned that “reciprocal” tariffs on America’s trading partners will come into effect on April 2 — the same day that the 30-day delay on 25 per cent tariffs on imports from its North American neighbours is set to expire.Trump has said he will raise tariffs to retaliate against taxes, levies, regulations and subsidies that Washington considers unfair. But the lack of detail on how reciprocal tariffs will work has made car industry executives nervous. Recent US trade negotiations with Mexico and Canada have placed car parts under the spotlight, raising the prospect that new rules or levies could also be imposed on core components that non-US carmakers bring in from Europe and Asia. “We are relieved for now [with the extension],” said an executive at a European carmaker. “But we don’t know what will be targeted tomorrow.” How has the 30-day extension on Mexico and Canada tariffs helped the industry?Washington’s latest tariff exemption applies to cars assembled in Mexico and Canada that are compliant with the terms of Trump’s 2020 free trade deal. For a vehicle to qualify as duty-free under the USMCA agreement, the proportion of a car’s components coming from North America needs to be at least 75 per cent of the total value. The vehicle’s production must also meet other conditions, including on materials used and wages.Since the 2020 agreement, the US and other international carmakers have invested in their North American manufacturing capabilities, shoring up their supply chains as well as their workforce.As a result, half of the parts for vehicles built in Canada by the Big Three — General Motors, Ford and Chrysler-maker Stellantis — on average come from the US. The share for cars assembled in Mexico is 35 per cent, according to lobbying group American Automotive Policy Council.If Washington decides to retain the USMCA rules, the majority of the car models produced in Canada and Mexico would meet the threshold for tariff-free trade. The exceptions are mostly smaller volume, high-end cars. Among international carmakers, Toyota and Honda have said almost all vehicles produced in North America are USMCA compliant, while Germany’s Volkswagen’s VW brand vehicles are compliant. BMW’s cars will not be part of the exemption as they fail to meet the 75 per cent threshold. Mercedes-Benz declined to comment, but its models are also likely to be non-compliant, according to S&P Global Mobility.What are the Big Three lobbying for? The latest delay to tariffs came after the Big Three carmakers lobbied hard to spare companies that had invested in North American manufacturing to meet the USMCA regulations.John Elkann, chair of Stellantis, has publicly urged the Trump administration to concentrate instead on car imports from countries such as South Korea, Japan and the EU — rather than vehicles coming from Mexico and Canada.“The real opportunity set for the administration in order to really boost jobs in America and manufacturing opportunities and investments is by closing the loophole that currently allows approximately 4mn of vehicles into the country”, Elkann told Stellantis investors in February. Imports from South Korea are at present tariff free, while duties are charged at 2.5 per cent on those from Japan and the EU. Moreover, these vehicles are not subject to US content rules, requiring a proportion of their parts to be made in America.Some content could not load. Check your internet connection or browser settings.Will car parts be included in Trump’s reciprocal tariffs? US officials have said they would impose reciprocal tariffs on a “country by country” basis, retaliating against non-tariff barriers as well. If they were to match US import tariffs to those imposed on US goods by other countries, car parts could be included in the case of the EU, which levies 10 per cent on vehicle imports and 3 to 4.5 per cent on imports of automotive parts. The US only charges EU exporters 2.5 per cent on vehicle imports. But Mark Wakefield, global automotive market lead at AlixPartners, said going after foreign-made components would be “complex and administratively expensive” to pursue. Still, industry executives remain nervous. Michael Robinet, executive director of automotive consulting at S&P Global, said 25 per cent tariffs against Japan, South Korea, EU and other countries that imported either vehicles or parts into the US were “very possible”.“With Covid, we knew there would be an end to the chip crisis,” he added, “but with this we do not know what the end looks like.”A prototype Toyota Tacoma pick-up truck on display at the Los Angeles Auto Show in 2021 More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Hong Kong has long been the world’s busiest air cargo hub, handling more than 4.3mn tonnes of cargo last year. The city’s airport plays a critical role in the global supply chain, connecting China’s industrial base with the rest of the world. But its strategic position also makes it increasingly vulnerable to escalating geopolitical tensions between the US and China, as well as the impact of US President Donald Trump-era tariffs.Multinational companies rely on Hong Kong for warehousing and distribution, while global logistics providers such as UPS and all-cargo airlines like Air Hong Kong use the city as a key trans-shipment hub. Cathay Pacific, the city’s flagship carrier, has been one of the biggest beneficiaries of this cargo volume, with cargo services accounting for more than a quarter of its total revenue.Cathay’s cargo revenue has been growing steadily, driven by higher freight rates and strong demand from ecommerce and expanding trade, particularly in electronics. Overall, the group’s cargo tonnage increased 11 per cent last year. Between Europe and Asia, pharmaceutical products and perishables — including China-bound shipments from markets like the UK, France and Belgium — are driving growth in its special cargo business. Escalating tariffs levied by Trump’s administration and renewed scrutiny on Chinese exports leave Hong Kong’s air cargo sector increasingly vulnerable to external shocks. Tariffs drive up the cost of cross-border trade, squeezing company margins and making air freight less affordable. Businesses looking to protect their bottom lines may begin shifting cargo to cheaper, albeit slower, alternatives such as maritime or land transport.If multinational corporations diversify their supply chains in response to geopolitical risks, such as relocating production to the US or south-east Asia, supply chains will become more fragmented, reducing cargo volumes through Hong Kong as demand for alternative re-export hubs grows.The long-term impact extends beyond freight. Economic uncertainty can also weaken demand for business travel, a key revenue driver for carriers operating US-China routes.Hong Kong remains indispensable to global logistics, and Cathay Pacific continues to reap the rewards. Its revenues rose more than a tenth last year to HK$104.4bn ($13.3bn) while its shares are up a third in the past six months, reflecting strong growth.But the forces at play now are larger than any single airline or airport. The resilience of Hong Kong’s cargo sector depends not just on freight demand, but also on broader geopolitical dynamics. On that front, the most important air traffic controller is the one who sits in the Oval Office. june.yoon@ft.com More

This is an on-site version of the White House Watch newsletter. You can read the previous edition here. Sign up for free here to get it on Tuesdays and Thursdays. Email us at whitehousewatch@ft.comGood morning and welcome to White House Watch!Donald Trump and Vladimir Putin are due to speak on the phone today about a ceasefire in the Russia-Ukraine war, with “land” and “power plants” on the list of concessions the US president wants from his Russian counterpart.In the meantime, let’s talk about:US economic growth slowdownTrump threat to Iran over Houthi attacks The man behind Meta’s rightward pivotThe US economy is losing its aura of invincibility.Tarnishing its lustre are Trump’s sweeping tariffs and his administration’s assault on government institutions, which leading economists have warned will slow US economic growth and accelerate inflation.Uncertainty around Trump’s economic policy will dent growth, according to almost all 49 economists polled by the FT and Chicago Booth. The polled economists expect the economy to expand 1.6 per cent in 2025, down sharply from 2.3 per cent in the December survey.Some content could not load. Check your internet connection or browser settings.The warning signs are becoming clear: consumers and businesses are pulling back on spending, and sentiment is sliding.Meanwhile, the OECD has warned that Trump’s trade war is taking a “significant” toll on the global economy, with growth projected to slow in both 2025 and 2026. Growth forecasts were slashed for a dozen G20 nations.As Robert Barbera, an economist at Johns Hopkins University, told the FT:Tariffs, tax cuts, government employment and expenditure cuts, assaults on education funding, and [Federal Reserve] independence all are in play. Nothing of the sort has been in play in my 50 years of forecasting.Weighing on the uncertainty is the fact that we don’t know which policies — including the cost-cutting craze from Elon Musk’s so-called Department of Government Efficiency (Doge) — will survive court challenges.The FT-Booth poll also found that economists anticipate that Trump’s policies will push inflation up. They forecast that the annual rate of the core personal consumption expenditures price index — a crucial metric for the Fed — will rise to 2.8 per cent by the end of 2025, up from a December prediction of 2.5 per cent.Some content could not load. Check your internet connection or browser settings.The Fed is all but sure to hold rates steady when policymakers meet tomorrow, but the bank’s overall message will be under scrutiny.The vast majority of polled economists are also worried about the reliability of the country’s economic data, which is vital for both the Fed and investors to have an accurate picture of the US economy.The latest headlinesWhat we’re hearingLet me introduce you to Joel Kaplan, the mastermind behind Meta’s pivot to Trump and CEO Mark Zuckerberg’s most trusted political fixer.He is a Republican lobbyist, newly promoted to the role of head of global affairs at the $1.7tn social media giant. Meta’s unexpected shift right — and its loosening of moderation policies — was the result of months of Kaplan’s careful planning. “He has Mark’s ear in a way that nobody does,” one person who has worked closely with Kaplan told the FT’s Hannah Murphy.Multiple former staffers claim that over the past 10 years, Kaplan has interfered in policy decisions, including about content staying online. They told Hannah that in some cases he’s overridden the company’s typical policy rationale or other senior decision makers so that right-wing figures wouldn’t complain about being censored.To some insiders, Kaplan is the powerbroker Zuckerberg needs to navigate the Trump administration and not become a target of the president’s retribution. But to critics, Kaplan’s focus on optics has come at the expense of online safety and alienating employees.His reputation has also taken a hit.Kaplan was in the news this week after an explosive new memoir by former Meta executive Sarah Wynn-Williams accused him of sexual harassment, including inappropriate comments (Wynn-Williams is married to an FT editor).ViewpointsRecommended newsletters for youFT Exclusive — Be the first to see exclusive FT scoops, features, analysis and investigations. Sign up hereBreaking News — Be alerted to the latest stories as soon as they’re published. Sign up here More