Jerome Powell's speech on July 22 at the Fed conference on the integrated review of the capital framework for large banks turned out to be indicative precisely because of what was not included. The Fed chair carefully navigated technical topics — the relationship of risk-based requirements, leverage ratios, buffers for globally systemically important banks, and stress tests — and emphasized two things: the system must work as a cohesive mechanism, and the regulator is open to feedback. No mention of rates, inflation, economic forecasts, or political pressure. In the week of 'silence' before the FOMC meeting (July 29–30), this is not just a polite protocol; it is a conscious strategy to minimize communication risk amid heightened political turbulence.
Powell separately noted that large banks must remain well-capitalized, manage key risks, and still be able to compete — among themselves, with non-bank financial institutions, and with foreign banks. For Washington, which is simultaneously tightening tariff regimes while trying to encourage companies to repatriate supply chains, the issue of the financial sector's competitiveness takes on added weight. The integrated review of capital requirements is not a bureaucratic rearrangement of acronyms, but an attempt to tune the regulatory 'engine' so that the banking system can withstand shocks from trade conflicts, capital movements, and potential waves of credit losses.
The context in which silence around rates has emerged is nervous. US Treasury Secretary Scott Bessent has been balancing between the White House's tough rhetoric and market realism in recent days. On one hand, the administration is promoting a package of tariff deadlines: August 1 — a broad date for a number of trading partners; August 12 — the cutoff for a temporary truce with China, after which tariffs at three-digit levels could formally return. On the other — Bessent emphasizes that the 'quality' of agreements is more important than a race to the date and allows for extensions, at least on the Chinese track. This is a typical tactic of Trump's tariff policy known as the 'pendulum': first maximum pressure through numbers, then space for a deal and another postponement. The market has already learned to read these gestures as a signal of increased volatility, rather than a solid roadmap.
Bessent unexpectedly softened his tone towards Powell: there is no direct need for his departure, and the best legacy may be the 'tidying up' of the non-financial functions of the Fed — from oversight to operational expenses. Against the backdrop of public reproaches from the White House and discussions about 'institutional review,' such support is important: it reduces the likelihood of an immediate personal conflict and shifts the discussion to a safer plane of procedures and structure. The less personalization, the higher the chances that the Fed will retain maneuvering space in monetary policy.
While politicians measure deadlines, the market votes with quotes. The dollar index (DXY) retreated from a four-week high of 99 reached on July 17, and by Tuesday evening it was holding below 98, occasionally dipping to around 97.7. The weakness of the dollar is not only a result of falling yields; it reflects investors' attempts to reassess the trajectory of rates in light of tariff risks and possible responses from partners. For multinational corporations, such a pullback serves as a partial buffer: currency revaluation smooths the impact on margins from more expensive imports. But the effect is asymmetrical: companies with a high share of imported components and local sales (autos, aerospace) suffer more.
Treasury yields continued to slide: the ten-year yield fell to around 4.34–4.37%, marking the fifth consecutive decline. The flight to long bonds combines caution ahead of tariff dates and growing discussions about Fed independence. Any hints of political interference in monetary policy traditionally draw investors to Treasuries as a 'clean' US asset, as long as confidence in the obligations themselves is not called into question. The paradox is that political pressure aimed at lowering rates, through the channel of uncertainty, sometimes produces the opposite market effect — a demand for protection and, consequently, a decline in long yields, which the policy would like to achieve, but for entirely different motives.
US stocks fluctuated in a narrow corridor on Tuesday after record closes in the S&P and Nasdaq the day before: a mixed stream of earnings met new tariff signals. Automakers and defense stocks are in the line of fire. General Motors explained a $1.1 billion deduction from operating income due to tariffs and warned of an intensified blow in the second half of the year; RTX (formerly Raytheon Technologies) cut its forecast due to rising metal prices; Lockheed Martin took a painful hit to earnings. These reports make the tariff issue 'material' for investors: it is no longer geopolitical noise, but real numbers in the reports.
Regional data from the Fifth District Fed (Richmond) added texture to the picture of economic differentiation. The manufacturing index plummeted to -20 in July (the lowest in ten months) amid a sharp decline in orders and shipments, and deteriorating employment. At the same time, the service sector showed slight positivity: revenue and demand indices were back in the positive, expectations remain constructive, although employment there is also stalling, and wage intentions have softened. This combination of 'industrial failure' and moderate service impulse fits into a scenario where tariff uncertainty primarily hits supply chains and capital-intensive segments, while local demand in services is holding up for now. But the gap is fragile: if companies start passing increased costs onto prices more widely, services could quickly react with cooling.
What will Powell see when he meets with the committee in a week? The minutes of the June FOMC meeting showed a divide: a 'pair' of participants were ready to discuss a rate cut as early as July, while the majority preferred to wait and see if tariffs would prove to be a more persistent inflation factor. A number of speeches in July only highlighted these discrepancies. Governor Waller urged not to delay easing, considering tariff price effects to be one-off; representatives of regional banks were more cautious, with some estimating that tariffs could add about a percentage point to inflation in the coming quarters. With inflation still fluctuating just above the 2% target and signs of slowing hiring, the committee has little desire to take a step that would need to be quickly reversed.
In such an environment, Powell's silence is not weakness but an attempt to maintain optionality. Any hint at the trajectory of rates will immediately be integrated into trade negotiations: US partners understand that a soft dollar and lower rates reduce the effectiveness of tariff pressure. By maintaining uncertainty, the Fed does not allow external counterparts to adjust their strategy to the anticipated easing. At the same time, silence reduces the chance that the White House interprets the chair's words as a challenge. Yes, the vacuum of comments is always filled with speculation, but for the central bank, between two politically charged deadlines — August 1 and 12 — this is the lesser of two risky trajectories.
For investors and the crypto community, the audience of Binance Square, the combination of 'silent Powell + soft dollar + tariff swings' means an increased likelihood of price spikes on macro news in the next three weeks. A weaker dollar historically supports gold and some major crypto assets, especially when political pressure on the Fed is discussed: the argument for 'alternative assets outside political jurisdiction' is once again becoming sellable. But the flip side is the risk of delaying the rate cut cycle: if the committee decides to wait until fall, real yields will remain relatively high, and appetite for high-risk tokens may shrink. In this context, stablecoins look like a working parking lot for liquidity between events, while the market decides which camp to move to.
Upcoming checkpoints: Bessent's comments after the meeting with the Chinese delegation next week; any signals regarding the shifting of tariff dates; inflation and employment data before September; and, of course, Powell's press conference after the July 30 meeting — when the 'period of silence' ends, and the market will have to hear something about rates. Until then, silence remains his most resonant statement.