BTC is fluctuating around 93,000! What did the Fed meeting minutes say? "This data" becomes the key

The attitude of the Federal Reserve: cautious interest rate cuts, not eager to loosen monetary policy.

The latest minutes released by the Federal Reserve show that officials of the Federal Reserve System (the Fed) hold a relatively optimistic view on the current economic situation, while maintaining a cautious stance on future monetary policy. The minutes revealed that committee members unanimously believe that if future inflation continues to return to the target range of 2% and the labor market remains strong, there may be a gradual adjustment of monetary policy towards a more neutral position.

At the meeting held on November 6th to 7th, the Federal Reserve voted unanimously to lower the Benchmark Intrerest Rate by 0.25 percentage points, adjusting the target range to 4.5% to 4.75%. This is the second consecutive rate cut, and there is still uncertainty in the market as to whether there will be another rate cut in December. Federal Reserve Chairman Jerome Powell has previously made it clear that the U.S. economy is performing well and there is no need to rush to lower interest rates. He emphasized that the Central Bank does not currently need to take action hastily and will carefully consider further dropping borrowing costs.

It is worth noting that, despite the increasing calls for rate cuts, officials have also warned that inflation remains above the 2% target level. The latest consumer price index (CPI) report shows that the inflation rate has risen to 2.6%, an increase of 0.2% compared to the previous period, adding uncertainty to further rate cuts.

Source: The New York Times. Federal Reserve Chairman Powell has recently made it clear that the US economy is performing well and there is no need to cut interest rates in a hurry.

Inflation and Labor Market: Cautiously Optimistic but Vigilant

The minutes of the meeting show that almost all committee members judge that although monthly data may have fluctuations, the overall data indicates that inflation is expected to sustainably return to 2%. Committee members listed several factors that could exert downward pressure on inflation, including weakened pricing power of businesses, currently restrictive monetary policy, and stable long-term inflation expectations.

However, some officials also warned that considering the underlying strength of the economy and the possibility of geopolitical risks and supply chain disruptions, the slowdown in inflation may be slower than expected. This means that the Federal Reserve will continue to closely follow economic data and adjust monetary policy flexibly based on actual conditions.

In the labor market, committee members are quite optimistic about the current situation. Although the number of non-agricultural employment positions increased by only 12,000 in October, this was mainly attributed to storms in the southeast and labor strikes. The committee generally believes that the current labor market is stable, with the unemployment rate remaining at a low level and no signs of rapid deterioration.

Future Outlook: Data Determines Policy Direction

The meeting minutes clearly pointed out that if inflation continues to be higher than the target level, the Fed may pause its rate-cutting pace. Richmond Federal Reserve Bank President Tom Barkin said:

If inflation remains above our target, we will proceed with caution; if the unemployment rate accelerates, we may be more proactive.

The market is still cautious about a rate cut in December. Traders are slightly inclined to another 0.25 percentage point cut, which Minneapolis Federal Reserve Bank President Neel Kashkari considers "reasonable". Chicago Federal Reserve Bank President Austan Goolsbee also supports the possibility of further rate cuts.

Currently, BTC is fluctuating around $93,000, while Ether has dropped to around $3,350. Market analysts have noticed that traders are adjusting their positions, and the volatility in the derivatives market is changing. Analysts at QCP Capital have observed that the buying and selling intentions of Ether options have shifted from buying to selling, reflecting market concerns about potential downside risks.

The government bond market has reacted subtly to this. The policy-sensitive two-year Treasury yield fell 0.02 percentage points to 4.25% after the release of the document, the lowest level in a week. The S&P 500 index had a slight pullback after the release of the meeting minutes, but ultimately rose 0.6% to a historic high.

Image source: Google Finance The S&P 500 index hit a new all-time high after the release of the meeting minutes.

Experts generally believe that the future monetary policy will depend heavily on the performance of inflation and employment data. The Federal Reserve will maintain a high degree of flexibility, closely follow economic indicators, and adjust policy positions in a timely manner when necessary. For the encryption market and TradFi market, the upcoming economic data will be the focus of attention, which may have a significant impact on asset prices.

【Disclaimer】The market is risky, and investment should be cautious. This article does not constitute investment advice. Users should consider whether any opinions, perspectives, or conclusions in this article are suitable for their specific situation. Invest at your own risk.

"BTC oscillated at 93,000! What did the minutes of the Federal Reserve meeting say? 'This data' is the key.' This article was first published in 'encryption city'."