Is a 50 basis point rate cut really a significant positive news?
Tonight's rate cut is basically a done deal, but how many basis points will be cut and whether the Federal Reserve's stance is hawkish or dovish will have different impacts on the market. Let Brother Wanshi tell you the details:
1. A 25 basis point rate cut while maintaining a dovish stance (highest probability)
A dovish stance means that the current economic outlook is not optimistic, and policies need to continue to loosen. This situation aligns with what most of us expect: the positive effects have already been exhausted, the market will first rise slightly and then decline all the way down.
2. A 25 basis point rate cut while maintaining a hawkish stance
If the Federal Reserve still issues hawkish statements in the face of such poor employment data, then there's no need to consider a market rise; it will just drop directly.
3. A 50 basis point rate cut (lowest probability)
This is the least likely scenario and the most frightening one. Generally speaking, a significant rate cut would definitely be positive for the cryptocurrency market, but I want to say that this rate cut is very different from previous ones. Trump has already attempted to interfere with the Federal Reserve's decisions. When the economy is linked to politics, the dollar loses its foundation of trust, which may cause the cryptocurrency market's gains to not be as significant as everyone expects. (Trump is indeed dancing on the edge of a knife; I feel he might become the fifth U.S. president to be assassinated) #美联储降息预期升温