#美联储维持利率不变 The Federal Reserve suddenly announced: Pause on interest rate cuts!
The Federal Reserve announced that it will maintain the federal funds rate range at 4.25%—4.50%. This is the first time the Federal Reserve has paused interest rate cuts since initiating the easing cycle last September.
It is noteworthy that the statement released after the Fed meeting omitted the phrase "progress towards the inflation target," which the market interpreted as more "hawkish." As a result, the three major U.S. stock indices plunged, with the Nasdaq down 0.51%, the S&P 500 down 0.47%, and the Dow down 0.31% at closing. Major technology stocks saw mixed results, with Nvidia plummeting over 4%, Tesla down over 2%, Microsoft down over 1%, and ASML soaring over 4%.
Subsequently, Fed Chair Powell's remarks at the press conference also released numerous policy signals. He stated that the Federal Reserve does not need to hastily adjust its monetary policy stance, as U.S. inflation remains somewhat elevated. Some commentators noted that Powell seemed to be singing a different tune from President Trump, who called for "immediate interest rate cuts" at the Davos Forum.
In response, Trump severely criticized Powell and the Federal Reserve, accusing them of "failing to stop the inflation problem they created" and doing "very poorly" in bank regulation, though he avoided directly commenting on the interest rate issue. This may further exacerbate the uncertainty surrounding monetary policy direction.
It is worth mentioning that this interest rate decision received unanimous support from all members of the FOMC (Federal Open Market Committee).
In fact, the market had fully anticipated the Federal Reserve's decision to pause interest rate cuts; just before the meeting, the CME Group's FedWatch tool indicated that traders in the interest rate market expected a greater than 99% probability that the Federal Reserve would pause rate hikes.
The statement released after the Federal Reserve emphasized that recent indicators suggest economic activity continues to expand at a robust pace. The unemployment rate has remained low recently, the labor market remains solid, and inflation is still at relatively high levels.
This statement removed references to the easing of tight labor market supply and demand and the slight rise in the unemployment rate, changing it to: "In recent months, the unemployment rate has stabilized at a low level, and the labor market remains robust."
