Upon waking up, an astonishing scene unfolded for investors.
The market's expectation for a Federal Reserve interest rate cut in December has surged to 90%, but the financial market has not welcomed a frenzy.
The US dollar has turned to rise, while gold and bitcoin fell at the closing, with the US stock market showing mixed results. All the uncertainties occurred in the last few hours before the close, as four Federal Reserve officials made speeches, pouring cold water on the world.
* Cleveland Fed President Mester stated that policymakers are 'at or near' the stage where they should slow down the pace of interest rate cuts, citing strong economic conditions and ongoing high inflation (implying: we are at the turning point for pausing interest rate cuts).
* Federal Reserve Chairman Bowman stated that progress on inflation may have stalled, and caution is needed in advancing interest rate cuts (implying: inflation is high, do not easily cut interest rates).
* Chicago Fed President Goolsbee stated that the labor market still looks stable, and he refused to disclose whether he intends to support an interest rate cut at the December meeting (implying: there is no urgency for an interest rate cut).
* San Francisco Fed President Daly stated that the Federal Reserve will wait and assess the net impact of several policies to be introduced by the incoming government before adjusting monetary policy (implying: wait for Trump to take office before making a judgment).
First, the timing of their speeches is very important - after the non-farm payroll data and before the quiet period - meaning this is their last word to the market before the December meeting.
Secondly, the four individuals expressed different perspectives, but one thing is the same - no one explicitly supports an interest rate cut in December. From the tone of the Federal Reserve, interest rates may be cut in December, or they may not.
Market expectations are already highly aligned, yet the Federal Reserve is still sending cautious signals, why is that? The Federal Reserve has issued some subtle warnings to the world, which many have not understood.
Another point to note: the US dollar has turned to rise. Although it is influenced by the speeches of Fed officials, it is also necessary to consider: the selling momentum is fading (the selling pressure is nearing its end).
This December will not be calm, the financial market is facing new uncertainties.
Today we released (Global Market Strategy: Winter Layout, A Group's Revelry), Wall Street has entered an emergency state, adjusting strategies and re-laying out. According to our calculations, the volatility of the global market in December is expected to be similar to November, indicating that we will still face a storm.
The report is excellent:
1. Will there be no interest rate cuts in December? We have released the latest interpretation (Global Market Friday Close: A Night of Change), telling you why the Federal Reserve changed its stance. Additionally, whether the US dollar has 'topped out' is also answered in this report.
2. Deconstructing the logical framework of 'Trump Trade 2.0' in three phases, we deduce the timing of major shifts in the global market. We will tell you the end time of 'Trump Trade 2.0', and what will happen to the US dollar, US Treasury yields, US stocks, gold, and oil markets before and after the end.
3. Trump's 'trade delegation' has been formed, who will lead it? What does Trump want? Why has China not contacted Trump? Will the renminbi fire the first shot in the currency war? We will provide you with more insider information.
4. Wall Street has highlighted 14 Chinese stocks this week, of which 2 received 'overweight' ratings.
