As the market generally expected, the Federal Reserve did not adjust interest rates during the July meeting, maintaining the current high rate status.
This time, the FOMC internal vote was also not surprising, with only Waller and Bowman, two typical hawks, choosing to cut rates, which can be seen as giving Trump a bit of an explanation. However, the mainstream faction still chose to stay put, after all, no one dares to take the lead in easing when employment and inflation have not shown clear signs of decline.
And how did the market react? Very realistically. Both the U.S. stock market and gold opted for a "disappointment-style pullback," with Bitcoin and Ethereum also following suit. Only the U.S. dollar index remained strong due to the maintained high interest rates and no immediate concerns. In simple terms, in this kind of market, no one wants to take on risk assets.
From the trend, Bitcoin briefly surged to 119K last night but could not hold, turning back down to the 115K area for consolidation. This downward move is more of an emotional release, and whether it continues will depend on the non-farm payroll and the upcoming PCE feedback. If the data continues to weaken, the pressure for a rate cut in September will return to Powell, and at that time, the stance will be really difficult to pin down.
