Analysis of the Fed's rate cut expectations and market-related situations

It is speculated that the Fed is likely to take interest rate cuts next month. However, once Trump's relevant policies were introduced, the market's expectations for the Fed's rate cuts by the end of 2025 were cut in half.

The current economic situation presents a rather complicated situation: economic data has risen, but inflation has not fallen. At the same time, the stock market has been soaring and constantly setting new heights.

The existence of these conditions has made the Fed extremely cautious when considering rate cuts, and it dare not easily make drastic operations. Take the statement of Fed Chairman Powell last week, for example, he clearly pointed out: "From an economic perspective, we have not been given any signal that an emergency rate cut is needed."

From the perspective of economists, nearly 90% of people believe that the Fed should cut interest rates by 25 basis points in December. But from the situation reflected in market pricing, the possibility of an actual rate cut in December is less than 60%.

Although various data indicators show that there seems to be a possibility of the Fed cutting interest rates, the market believes that the momentum of the US economy is too strong and inflation is still at a high level.

Therefore, considering various factors, the Fed is unlikely to cut interest rates as much as we expected before. After all, they still need to keep a close eye on inflation to prevent it from getting out of control.

You must know that when facing a big bull market, the test we face is not only limited to the ups and downs of the market itself, but more importantly, it is a test of our own mentality.

When we see that the account funds change with the market, we must always maintain a rational way of thinking, so that we can better respond to various changes in the market and make more reasonable investment decisions.

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