Is the dream of the Federal Reserve's rate cut in September about to shatter?
Recently, there has been a lot of talk about the Federal Reserve's inevitable rate cut in September, with probabilities inflated to over 90%! But is the truth really as such? Not at all, Wall Street institutions are quietly retreating, while only small investors are still bottom fishing. These truths you need to know!
Don't be fooled by the 4% unemployment rate! The Federal Reserve opposes rate cuts, believing that employment is not collapsing; and every time the Federal Reserve cuts rates when employment is strong, it triggers a secondary inflation rebound. Does Powell dare to take the risk this time?
At the global central bank annual meeting this Friday, Powell emphasized that data speaks for itself, but the crucial August inflation and employment data will only be released in September. This means there won't be enough data to support a rate cut before the September meeting!
Now the market is like a casino, small investors are betting on a rate cut, while Wall Street is retreating. Goldman Sachs even advises clients to hedge against the risk of no rate cut in September.
When everyone is saying this time is different, it is often the most dangerous moment. The Federal Reserve's style has never been black and white!