The U.S. Federal Open Market Committee (FOMC) announced its latest interest rate decision at 31st at midnight Taiwan time, keeping the federal funds rate in the range of 4.25% to 4.5%, remaining unchanged for the fifth consecutive time. However, this meeting passed the resolution with a vote of 9 to 2, with two members appointed by Trump, Waller and Bowman, unusually voting against it, advocating for an immediate rate cut, indicating a significant divergence within the Federal Reserve regarding future policy direction.
Economic outlook is uncertain, inflation remains above target.
Chairman Powell pointed out in the post-meeting statement that recent indicators show economic activity growth has slowed in the first half of this year, export fluctuations have affected the data, inflation levels remain slightly above the long-term target of 2%, but the good news is that the unemployment rate remains low, and the job market is robust.
The current uncertainty regarding the economic outlook remains high, and the committee is closely monitoring the two-way risks facing its dual mandate.
Powell did not provide a clear timeline for a rate cut, and market expectations have cooled.
At the same time, Powell did not respond directly to questions about a rate cut in September during the press conference.
He stated that decisions will depend on economic data, and currently, most committee members still believe it is reasonable to maintain a 'moderately tight' policy stance. This caused market expectations for a rate cut in September to drop from over 60% before the meeting to below 50%, indicating that Powell's remarks clearly dampened short-term rate cut expectations.
Rate cut signals fell flat, financial markets reacted.
Due to the Federal Reserve not signaling an imminent rate cut, the dollar strengthened, and the Dollar Index (DXY) surged by 1.1%, with the U.S. 2-year Treasury yield rising to 3.94%.
Performance of the four major U.S. stock indices on the 30th:
The Dow Jones Index fell by 171.71 points, or 0.38%, closing at 44,461.28 points.
The Nasdaq Index rose by 31.38 points, or 0.15%, closing at 21,129.67 points.
The S&P 500 Index fell by 7.96 points, or 0.12%, closing at 6,362.9 points.
The Philadelphia Semiconductor Index rose by 47.53 points, or 0.83%, closing at 5,787.32 points.
In the cryptocurrency market, Bitcoin briefly spiked to $115,716 after the announcement, but then began to rebound quickly, reporting $118,275 before this article was published, showing resilience.
Other cryptocurrencies, aside from Ethereum which rebounded significantly back above $3,800, mostly remained in a downtrend over the past 24 hours, reflecting investors' wait-and-see attitude.
Although the Federal Reserve meeting kept interest rates unchanged, internal decision-making differences and Powell's reserved attitude toward the timing of rate cuts have created uncertainty regarding future policy direction, with economic data and inflation trends remaining key points of observation.