On Wednesday, the Federal Reserve announced a 25 basis point rate cut as expected, marking the third rate cut of the year. Despite this move aligning with widespread market expectations, there were significant disagreements within the meeting.
In the policy statement, the Federal Reserve signaled that the future room for rate cuts may narrow, a position that was further reinforced in the subsequent speech by Chairman Powell, who emphasized the caution in policy adjustments under the current economic environment, suggesting that the pace of future rate cuts may slow.
As a result of this news, the spot gold market experienced significant volatility, with prices showing sharp rises and falls. After the Fed's decision was announced, the price of Bitcoin initially surged quickly before facing heavy selling pressure and declining significantly, but ultimately stabilized and rose again, reestablishing itself above 94000.
Last night, Master Powell's final dance caused little disturbance in the market, casually drawing another door as if it were routine. The market's silence regarding the new version of QE truly shows a lack of respect. Bitcoin, being the most sensitive to liquidity, shouldn't be performing this poorly.
However, what was most noteworthy last night was that the expectation for a direct drop to 2% next year, as hoped by Trump, has begun to surface within the Federal Reserve.
