Ella 
The revelation of the Federal Reserve’s conference is that the Fed has not yet prepared for interest rate cuts. However, they are satisfied with the trend of currency tightening. Fed Chairman Powell believes that it will cut interest rates at some time this year. Jerom Powell is not as clear as the time when talking about interest rate cuts, as the European Central Bank President Christina Lagader, the market believes that the possibility of cutting interest rates in March is not much. 36%.
Prior to this meeting, we stated that due to strong economic growth and rebound in the stock market, the Fed may overthrow the previous pigeon speech. The Fed did counterattack this, and the market heard it. Stocks are obsessed with the prospect of rate cuts, which has driven them higher so far this year. But the reality is that the Fed is not ready to cut interest rates yet, which may dilute the market’s bullish sentiment heading into February.
No pre -promised interest rate cut
Powell was not explicitly dovish at this meeting and was unwilling to precommit to cutting interest rates. This reduces the expectations of interest rate cuts in March. However, although the Fed has not willing to promise the first interest rate cut, the interest rate cut in 2024 still exceeds 5.5 times. Therefore, it may be necessary to adjust the expectations of interest rate cuts, which may make it difficult for the stock market to rebound extensively from this.
Changes to Fed Statement
In general, the tone of the attached statement is more optimistic about economic growth, and the prospect of the return of inflation is also more neutral. The Fed upgraded its economic outlook, saying economic activity is “expanding at a solid pace” and maintaining its view that job growth remains strong and the unemployment rate remains low. The Fed deleted previous comments that tight financial conditions were weighing on economic growth, saying instead that the committee “judges that risks to achieving its unemployment and inflation goals are becoming better balanced.” This may be considered less hawkish than before, when they asserted that a rate hike was possible, but certainly not dovish.
