Jerome Powell just finished his press conference, and the message is clear: the Fed is officially in a "wait and pray" mode.
While rates remain unchanged at 3.5%-3.75%, the real story is in the Dot Plot shift. The July rate cuts everyone was betting on have effectively vanished. Powell admitted that the Middle East escalation has introduced a "New Inflation" cycle that the Fed simply cannot control.
The Quote of the Night:
"We can print liquidity, but we cannot print oil." The Macro Audit:
$110 Brent Crude: Even with a historic 400M barrel strategic reserve release, prices are surging. The market is realizing that a 90% shipping plunge in the Strait of Hormuz is a structural disaster, not a temporary spike.
The Infrastructure Hit: With strikes hitting the South Pars and Asaluyeh facilities, we aren't just looking at a blockade—we’re looking at the physical destruction of global energy capacity.
The "Higher for Longer" Trap: Powell’s reference to 1970s-style stagflation confirms that the Fed will keep rates high even as the economy slows, just to fight energy-driven prices.
This is where most traders get trapped. They’re waiting for a "pivot" that the physical world won't allow.
We’re no longer watching a standard business cycle; we’re watching a global energy war rewrite the rules of finance in real-time. 📉🤔