Breaking! Federal Reserve, Major Variables! Musk is Ready to Take Action Against the Federal Reserve!
The highly anticipated Federal Reserve is about to undergo adjustments, with four chairs from the Boston Fed becoming new voting members, while four chairs from the Cleveland Fed will step down.
This could lead to more disagreements within the FOMC, with hawkish and dovish views becoming more opposed.
Musk, as a co-leader of the U.S. 'Department of Government Efficiency', openly stated on social media that 'the Federal Reserve is excessively overstaffed', sparking heated discussions in the market, with many speculating that the department he leads may take action against the Federal Reserve.
This department aims to streamline the federal government size, cut administrative expenses, and has recruited over 100 staff members, preparing to implement bold reform measures including layoffs and the cancellation of certain regulatory policies. Musk even hopes to significantly reduce the number and budget of federal agencies.
At the market level, the current outlook for the Federal Reserve's interest rate cuts remains the main trading line, but uncertainty is sharply rising for 2025. As investors, we not only need to cope with the possibility of the Federal Reserve pausing interest rate cuts but also face potential market turbulence brought by the Trump administration.
In the December policy meeting, as many as 15 Federal Reserve officials believed that inflation faced upward risks, prompting interest rate market traders to quickly adjust their expectations. The latest swap market data shows that traders are underpricing the possibility of rate cuts in the first half of next year, and U.S. Treasury yields have experienced an unusual rise, with the 10-year bond yield rising more than 75 basis points, and the average interest rate on 30-year mortgages increasing instead of decreasing.
Impact on Bitcoin: First, as uncertainty in interest rate policy increases, investors may push up Bitcoin prices due to safe-haven demand; second, the movement of the dollar is influenced by Federal Reserve policies, with the strength or weakness of the dollar inversely affecting Bitcoin prices; third, the market sentiment fluctuations triggered by Musk's remarks may indirectly change investors' attitudes toward Bitcoin, prompting changes in its price and activity.