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The decision of the Federal Reserve, maintaining the upper limit of the Interest Rate at 5.5%, is in line with market expectations. It seems calm on the surface, but there are hidden undercurrents.
Powell's speech is like a misty view of flowers, leaving people puzzled.
He said the committee's Consensus on rate cuts is gradually approaching, but also stressed that it has not yet reached that critical point. It's like a boot hanging in the air, leaving people in suspense.
Interest rate cuts seem inevitable, but when it happens depends on his mood. This mood may be hidden in the complex web of data and risks.
Inflation is no longer the sole criterion for interest rate cuts, which undoubtedly brings more variables to the market. The 2% target seems distant, but it also fills people with confidence. After all, in the balance of data and risk, the Federal Reserve always treads cautiously.
The upcoming election has made the question of whether to cut interest rates a sensitive topic.
Powell made it clear that the rate cut in September is not a done deal, and any political decision needs to balance data and risk. It's like a game of cards, where every move needs to be carefully considered.
Economic data shows that the situation is still acceptable, although there are signs of weakness in some areas, overall there is no major problem.
The unemployment rate is even lower, and the labor market is more balanced, which may be an important consideration for interest rate cuts.
However, the downside risks to employment still exist, like a ticking time bomb, forcing the Federal Reserve to be cautious in its decision-making.
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