Next week, the Federal Reserve will enter its pre-meeting quiet period. Although most analysts are certain that there will be a 25 basis point rate cut on December 11, U.S. interest rate futures give about an 80% probability of a rate cut—the remaining 20% needs confirmation from economic data.
And next week will just happen to welcome a flood of data.
On Monday, the U.S. November ISM Manufacturing PMI (previous value: 48.7; market expectation: 49)
Market expectations will improve slightly, but continue to be in a contraction range. The manufacturing sector has been 'lying flat' for an entire year, and it is difficult to suddenly revive. As long as the results fluctuate in the 47–50 range, it can be considered 'no surprises, no excitement.' The real risk is if it suddenly jumps above 50, risk assets will become tense immediately. Because that represents an economic rebound, reducing the reason for interest rate cuts.
On Wednesday, the U.S. November ADP employment figure (previous value: 4.2; market expectation: 2)
Cooling employment is one of the key reasons for interest rate cuts. However, due to the absence of non-farm data, the importance of this ADP has been magnified (seen as “temporary non-farm”). The risk with ADP is that it is unreliable, often deviating from the official non-farm data, and the data can occasionally show “strangely strong” results.
On Friday, the U.S. September core PCE price index (previous value: 2.9%; market expectation: 2.8%)
This is the indicator that the Federal Reserve values most, even if it's two months late (the data released this time is still from September), it remains effective for policy signals. Recently, both CPI and PPI have been relatively soft, indicating that the impact of tariffs on inflation is not as frightening, so the core PCE for September should also be mild. As long as the core PCE does not rebound, the Federal Reserve's so-called “downward path of inflation has been reestablished” can be considered complete — this is the reassurance for pushing for interest rate cuts.
From the market's perspective, the three data points mentioned above all support further interest rate cuts. The data doesn't need to be very bad; as long as it is “not strong,” the market will push the probability of rate cuts to 90% or even 100%.
The current market has entered a typical phase:
“Bad news = Good news” (supports interest rate cuts)
“Good news = Bad news” (delays rate cuts, hits risk assets)
“Good enough” = The most comfortable range for interest rate cut expectations
What the market needs most right now is “weak but not collapsing” U.S. data — the real risk is that the data suddenly becomes strong.#加密市场反弹 $BTC
