$BTC A closer look at the Fed meeting in the early hours and my take
Guys, tonight’s September FOMC minutes will most likely be a formality. The market has already priced in no rate hike in October.
But what’s interesting isn’t the outcome—it’s how quickly the mood has shifted over the past few days. The Fed just raised rates by 25 basis points in September, and the market was still worried they’d do it again in October. Then one jobs report completely upended expectations.
The U.S. added just 29,000 jobs in September, versus expectations of 90,000—that’s a huge miss. The unemployment rate rose to 4.2%, and wage growth is slowing too. Put simply, the labor market is starting to cool, so the Fed has no reason to rush into consecutive rate hikes.
The market now puts the odds of another rate hike in October at around 20%—well below 50%. Plus, Warsh was nominated by Trump, and the Fed already raised rates by 25 bps in September. Trump has kept stressing that rates shouldn’t go up, so they’ll probably have to take that into account. They can’t afford to upset either side!
Another thing to watch: U.S. inflation is still above 3%, and oil prices have climbed back above $100. With both of those factors in play, the Fed can’t really pivot to easing. The market is now betting on a possible hike in December. So don’t assume that no hike in October means the bad news is out and it’s automatically good news. The bulls have been quiet in the market, while the bears have been hammering it all day. Most likely, everyone’s waiting for tonight’s data before making a move.
If you haven’t figured out your direction yet, come join us in the chatroom and let’s find the right rhythm together!!! #美联储纪要聚焦10月暂停加息
Guys, tonight’s September FOMC minutes will most likely be a formality. The market has already priced in no rate hike in October.
But what’s interesting isn’t the outcome—it’s how quickly the mood has shifted over the past few days. The Fed just raised rates by 25 basis points in September, and the market was still worried they’d do it again in October. Then one jobs report completely upended expectations.
The U.S. added just 29,000 jobs in September, versus expectations of 90,000—that’s a huge miss. The unemployment rate rose to 4.2%, and wage growth is slowing too. Put simply, the labor market is starting to cool, so the Fed has no reason to rush into consecutive rate hikes.
The market now puts the odds of another rate hike in October at around 20%—well below 50%. Plus, Warsh was nominated by Trump, and the Fed already raised rates by 25 bps in September. Trump has kept stressing that rates shouldn’t go up, so they’ll probably have to take that into account. They can’t afford to upset either side!
Another thing to watch: U.S. inflation is still above 3%, and oil prices have climbed back above $100. With both of those factors in play, the Fed can’t really pivot to easing. The market is now betting on a possible hike in December. So don’t assume that no hike in October means the bad news is out and it’s automatically good news. The bulls have been quiet in the market, while the bears have been hammering it all day. Most likely, everyone’s waiting for tonight’s data before making a move.
If you haven’t figured out your direction yet, come join us in the chatroom and let’s find the right rhythm together!!! #美联储纪要聚焦10月暂停加息
