$ETH
Key Points from Powell's Speech
1. Statement Overview: The wording remains largely unchanged, with a vote ratio of 11-1 to pass the decision to cut interest rates by 25 basis points, and Harker supports pausing rate cuts. The ON-RRP was lowered by 30 basis points.
2. Interest Rate Outlook: Consideration will be given to the 'magnitude and timing' of further rate cuts. The median in the dot plot has been raised, indicating that there will be two rate cuts in each of the next two years, although there are significant disagreements among some officials.
3. Inflation Outlook: The timeline for achieving the 2% inflation target has been pushed back to 2027, with overall upward revisions to expectations for 2024-2026, and most officials expect risks to be tilted to the upside.
4. Economic Outlook: Slightly lowered unemployment rate expectations. The wording on steady economic growth remains unchanged, with upward revisions to actual GDP growth expectations for this year and next, from 2% significantly raised to 2.5%.
Powell's Press Conference:
1. Interest Rate Outlook: Consideration for rate adjustments can be more cautious; changes in statement wording indicate that they are in or close to a slowing rate cut phase, and it seems unlikely that rates will be raised next year. If inflation does not move sustainably toward 2%, rate cuts can be slower. Too slow rate cuts may hurt the economy and employment.
2. Inflation Outlook: It may take another year or two to reach the target; risks and uncertainties are high; discussions are ongoing about how tariffs drive inflation.
3. Economic Outlook: Overall economic performance is strong, with economic growth in the second half expected to be faster than anticipated, and there is no reason to believe the likelihood of an economic downturn is higher than usual.
4. Employment Outlook: The labor market remains robust, not a significant source of inflationary pressure, has not cooled to a concerning degree, and will continue to be monitored.
5. Other Statements: (Regarding Bitcoin reserve policy) The Federal Reserve does not allow and has no intention to hold Bitcoin. Today's rate decision was a relatively difficult choice.
6. Market Reaction: From the announcement of the statement to Powell's speech, spot gold dropped sharply by $56; the dollar index has risen by 110 points since the announcement of the decision, reaching a two-year high; the 2Y U.S. Treasury yield rose by 15 basis points; the Nasdaq's decline expanded to 3%; Bitcoin fell by more than $5000.
7. Latest Expectations: Traders' pricing for Fed rate cuts continues to decrease, expecting only a 37 basis point cut in 2025, far lower than the 75 basis points expected before the meeting.