The results of the Federal Reserve's FOMC meeting early this morning are out - another familiar script: interest rates remain unchanged at 4.25%-4.5%, but the dot plot has thrown a bucket of cold water on the market. The originally expected two rate cuts this year have been reduced to just one, and hoping to rely on easing in 2025? Wake up, Powell, this old fox has no intention of feeding the market sugar!
Core results: Hawkish stance remains, rate cut expectations halved.
Interest Rate Decision: The 4.25%-4.5% range is maintained for the third consecutive time, meeting expectations but with no surprises.
Dot Plot Shock: The expectation for a rate cut in 2025 shrank from 50 basis points (two cuts) to 25 basis points (one cut), while the scenario for a 75 basis point cut in 2026 remains unchanged. Even harsher, 11 out of 19 committee members believe there will be at most one cut this year, with 8 even stating 'not a single cut'.
Economic Forecast: GDP growth rate revised down from 1.7% to 1.4%, but inflation expectations raised - core PCE surging from 2.8% to 3.1%, clearly indicating that stagflation risks cannot be suppressed.
Market Reaction: The dollar index instantly surged by 0.8%, and BTC dropped below $61,000 in response.
Powell's Press Conference: Stubbornly hawkish, but with hidden nuances.
This old man maintained a hawkish demeanor throughout, but upon closer inspection, there are three key pieces of information:
'Not in a hurry to cut rates': The original statement was 'Policy is already moderately restrictive, but inflation is still high,' which translates to 'Retail investors, don't dream.'
'Tariffs are an inflation bomb': Directly naming Trump's tariff policy, he indicated that once inventories are depleted, inflation could explode again.
'The labor market is still strong': The unemployment rate is stuck at 4.2%, non-farm data exceeded expectations, rate cut? No excuses.
Impact on the Crypto Market: Liquidity expectations have collapsed, but don't panic!
Short-term bearish: Delayed rate cuts = tightening dollar liquidity, especially affecting altcoins. High beta assets like XRP and SOL may drop another 10%-15%.
Long-term game:
