Just now, a "hawk" flew out from within the Federal Reserve!
Federal Reserve Governor Musalem made it clear on Friday:
"Given that the inflation rate has consistently been above target, I am unwilling to support further interest rate cuts."
Translate his core message:
1. The current situation is pretty good: He believes that the current interest rate of 3.5%-3.75% is not considered high and is unlikely to suppress the economy.
2. Inflation first: As long as inflation is still rising, don’t expect him to vote for rate cuts to stimulate the economy.
3. Concern about adverse effects: He even believes that cutting rates to support the job market may backfire, pushing long-term rates (like mortgages) higher instead.
$PAXG $XAG
What does this mean for the market, especially for our crypto circle?
This is a cold shower for the market that is looking forward to more quantitative easing in 2026!
It reinforces a core narrative:
The Federal Reserve's rate cut cycle may be shorter and less aggressive than expected, and it may even "pause" for a long time. The high-interest rate environment will continue to suppress the valuation of risk assets.
$BTC Short-term pressure is highly likely, as it is extremely sensitive to expectations of global dollar liquidity.
When the expectation of cheap money fades, the market will reprice all assets.
Buckle up, the test of liquidity tightening is not over yet!
