In the early morning, the Federal Reserve released the minutes of its monetary policy meeting, directly discouraging expectations of a "rate cut" next year.

During the session, the 10-year U.S. Treasury yield recovered 4%, and the U.S. dollar also took advantage of the momentum to rise. The contents of the minutes have dealt a blow to the easing policy that has been highly supported by the market from last month to now. One-sided belief is that the Federal Reserve will soon enter an interest rate cutting cycle and end monetary tightening.

Pour a basin of cold water directly from head to toes. However, the minutes also hinted that the interest rate hike cycle is over. The last monetary policy meeting last year ended on December 13, 2023, and it chose to suspend interest rate increases three times in a row, keeping the federal interest rate unchanged at 5.25%~5.5%.

Now, if interest rates are not raised, it is only a matter of time before interest rates are cut. In the middle, keeping high interest rates unchanged means waiting for the CPI data to drop below 3%, or even move closer to the 2% target. Powell has also stated many times that it is impossible to wait for 2% inflation data before cutting interest rates. Then By that time, everything was too late.

As we all know, market sentiment expectations are more powerful than the truth, which is the collective consensus that when individuals join the group, their cognition will be greatly reduced and they will lose their judgment. "Buy expectations, sell facts", or "Sell expectations, buy facts."

Interest rate cuts are based on expectations. There has been a lot of speculation in the early stage, which has pushed up the price of gold and suppressed the US dollar and U.S. Treasuries. But now it is just a matter of speculation based on the minutes of the Federal Reserve meeting. #BTC #ETH