The Federal Reserve will announce the latest interest rate decision, which will set off a financial wave?
1. Decision time and market expectations
The decision will be announced at 2:00 am on May 8th, Beijing time. According to CME data, the probability of maintaining interest rates unchanged in May is 97.2%, and the probability of interest rate cuts is only 2.8%. It is expected that there will be three interest rate cuts throughout the year, concentrated in the second half of the year. If the April non-agricultural (177,000 new jobs) and PCE price index perform steadily, the first interest rate cut may be postponed to July, and the policy interest rate may remain at 4.25%-4.50%.
2. Focus
Powell's statement is the key. "Hawks" may intensify conflicts with Trump and cause market fluctuations; "doves" will boost the market and ease conflicts. Trump has repeatedly called for interest rate cuts, and the game of positions between the two sides affects the market.
3. Economic data support
In April, non-agricultural jobs increased by 177,000, the unemployment rate was 4.2%, the labor participation rate rebounded, and the PCE price index showed that inflation eased, but there is uncertainty about tariffs. If data such as the ISM non-manufacturing PMI are positive, it will support the Federal Reserve to keep interest rates unchanged.
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