The Fed’s minutes from this meeting were indeed quite hawkish.
After raising rates by 25 basis points in September, most officials still leaned toward further hikes this year. Interestingly, though, market bets on a rate hike in October fell from around 70% to 20%.
I don’t think this means the market doesn’t believe the Fed. It’s that everyone understands there’s a difference between talking tough and actually taking action.
Inflation hasn’t been brought under control, so of course the Fed can’t easily back down. But whether the economy can withstand consecutive rate hikes is another question.
In my view, simply using “hawkish minutes” to judge where U.S. stocks and BTC are headed doesn’t mean much anymore.
After all, markets trade on expectations, not headlines.
Once the CPI data comes out, if inflation continues to exceed expectations, investors betting on a pause in rate hikes will have to reassess. If the data starts to cool, then no matter how tough the Fed talks, the market may not buy it.
The easiest way to get burned during this period is to chase a decline at the sight of bad news, then chase a rally when good news appears.
Especially when policy expectations are swinging back and forth like this, the news itself may not be the scary part. It’s sudden shifts in market expectations that can trigger big moves.
#美参议员调查CantorFitzgerald与Tether关系
After raising rates by 25 basis points in September, most officials still leaned toward further hikes this year. Interestingly, though, market bets on a rate hike in October fell from around 70% to 20%.
I don’t think this means the market doesn’t believe the Fed. It’s that everyone understands there’s a difference between talking tough and actually taking action.
Inflation hasn’t been brought under control, so of course the Fed can’t easily back down. But whether the economy can withstand consecutive rate hikes is another question.
In my view, simply using “hawkish minutes” to judge where U.S. stocks and BTC are headed doesn’t mean much anymore.
After all, markets trade on expectations, not headlines.
Once the CPI data comes out, if inflation continues to exceed expectations, investors betting on a pause in rate hikes will have to reassess. If the data starts to cool, then no matter how tough the Fed talks, the market may not buy it.
The easiest way to get burned during this period is to chase a decline at the sight of bad news, then chase a rally when good news appears.
Especially when policy expectations are swinging back and forth like this, the news itself may not be the scary part. It’s sudden shifts in market expectations that can trigger big moves.
#美参议员调查CantorFitzgerald与Tether关系