I just listened to Powell's speech after the Fed's decision to cut the rate by 0.25 percentage points. And what immediately stood out is that it’s not at all what the dovish hawks expected. Powell was quite cautious in his wording.

The main takeaway from Powell's speech: further cuts in December are not a certainty at all. It was explicitly stated that this is not a predetermined scenario. There are serious disagreements among Fed members regarding the future strategy. It was not a consensus, but a decision made by a majority vote.

Powell emphasized that inflation remains elevated, although the consumer price index came in slightly below expectations. The outlook for employment and inflation has hardly changed since September. Demand for labor has clearly decreased, but the labor market is not experiencing a rapid downturn. Layoffs and hiring remain at low levels.

This was immediately reflected in the market. Bitcoin plunged below $110,000, setting a low in correction at $109,200. But then it was bought up fairly quickly. The current price is closer to $111,000.

Another interesting point from Powell's speech: PCE increased by 2.8%, disinflation continues in the services sector. Most long-term inflation expectations indicators are normal. But there is concern about tariffs—they are leading to higher prices for goods. Powell hopes that the impact of tariffs will be short-term.

The key point: the risk balance has shifted, and the Fed cannot address employment and inflation issues simultaneously with one tool. This explains the cautious tone.

In December, the next phase of balancing will begin, which will be stable for some time. At some point, reserves will start to be replenished, but the final timing has not yet been determined.

The most important thing for traders: if data shows stabilization or strengthening of the labor market, it will influence rate decisions. Powell's speech showed that the Fed will act cautiously and depend on data. No guarantees for December.