Why did the Federal Reserve choose not to intervene?
1. Economic Factors
1. Inflation Pressure: Trump's tariff policy has raised import costs, which may lead to rising inflation. The Federal Reserve needs to guard against price increases evolving into more persistent inflation, so it is not in a hurry to adjust interest rates.
2. Employment and Economic Growth: The U.S. job market is performing strongly, but tariff policies may lead to slower economic growth and increased uncertainty in the job market. The Federal Reserve needs to balance inflation and employment goals, avoiding premature intervention that could trigger other issues.
2. Policy Independence
1. Legal Protection: The Federal Reserve has independence, and its decisions are not subject to government interference. Powell emphasized that the Federal Reserve's independence is legally granted, and the government does not have the authority to arbitrarily dismiss officials.
2. Avoiding Political Interference: The Federal Reserve avoids making hasty decisions under political pressure to maintain the fairness and effectiveness of its policy-making.
3. Market Factors
1. Market Self-Regulation: Powell believes that the market is effectively digesting uncertainty, and the Federal Reserve should not overly intervene in the normal functioning of the market.
2. Preventing Moral Hazard: Avoid creating a dependency mentality in the market, preventing financial institutions from taking excessive risks, and maintaining long-term stability in the financial market.
In summary, the Federal Reserve's choice not to intervene is to address the current complex economic situation, maintain policy independence, and ensure market stability. The hero dog Conan on the SOL chain currently has low market value and great potential, worth paying attention to!
