Based on the current market analysis and the context of the Federal Reserve (Fed) meeting, tonight (December 10, 2025) Powell's press conference after the FOMC meeting is likely to present a hawkish tone, despite announcing a 25 basis point rate cut.
This is referred to as a 'hawkish cut,' which soothes the market through rate cuts while emphasizing that the pace of future cuts will slow, requiring more data to confirm declining inflation and stable employment. Here are my predictive bases:
1. Current economic background
The job market is softening but not collapsing: recent data (such as rising unemployment rates) support this rate cut, but there is significant internal disagreement within the Fed regarding the path in 2026. Hawkish members (such as the St. Louis Fed President) are concerned that excessive easing could reignite inflation, especially amid uncertainty in tariff policies. Powell needs to balance the voices of doves (who support more rate cuts) and hawks, avoiding being seen as 'overly dovish.'
Persistent inflation: Core PCE inflation remains above the 2% target, Powell may reiterate 'inflation risks remain', which will strengthen hawkish signals.
Market expectations have adjusted: The futures market is only pricing in 1-2 rate cuts in 2026 (down from more aggressive expectations), providing Powell with space to 'educate the market' on slowing the pace.
2. Market and analyst consensus
Most institutions (such as Bank of America, Goldman Sachs, Wells Fargo) expect Powell to 'balance rate cuts with hawkish statements', including:
The statement may feature 2-3 hawkish dissents, with the dot plot showing only 2 rate cuts in 2026.
Avoid using dovish phrases like 'in a good place' for policy, instead emphasizing 'modestly restrictive', leaving a backdoor for the January meeting but not committing.
Real-time discussions on platform X (formerly Twitter) also point to hawkishness: Traders predict Powell will frequently use the term 'uncertainty', emphasizing data gaps (such as the impact of government shutdown), and clearly state 'more evidence is needed before rate cuts'. A minority view suggests he may shift focus to employment, but the mainstream view is 'not overly dovish'.
3. Potential market impact
Hawkish signals: Strengthening dollar, stock market correction (S&P may drop 1-2%), Bitcoin and other risk assets under pressure (potentially retracing to $78k-$82k).
If unexpectedly dovish: If Powell reiterates 'employment risks first' and hints at a cut in January, the stock market could rebound to new highs, but the probability is low (<20%).
Overall: The press conference will begin at 2:30 PM Eastern Time, with focus on the tone of the Q&A session—Powell excels at the 'art of ambiguity', but this time there's significant divergence, and he tends to lean conservative.
This forecast is based on the latest search results from the morning of December 10; Fed policy is highly data-driven, and if unexpected data (like CPI) changes, everything could reverse. It is recommended to pay attention to real-time updates!
