09.10.25 - Anything new from the Fed?
Federal Reserve Chair Jerome Powell is set to speak today at 2:30 pm CET, just one day after the publication of the FOMC minutes from the September meeting.
Nothing new by now:
- the Fed is deeply divided over how far and how fast to cut interest rates as the balance of risks has shifted
- growing signs of economic and labor market weakness
- persistent inflation pressures
- overall cautiously dovish tone
Market expectations lean toward more cuts this year.
Markets: continue the rally despite uncertainties
US indices are trading on record highs
Gold takes a pause after recent strong move
Bond yields slightly up with US 10-year Treasury yield at 4.13%
US dollar moves sideways
Volatility index (VIX) remains subdued
My View: I do not expect any major announcement in today’s speech. Without the latest jobs data, Powell simply lacks the evidence needed to justify a change in tone or policy stance.
Yet a deeper question is beginning to surface: how independent is the Federal Reserve current environment?
This question is not answered by few independent investors, but by how global markets perceive the Fed’s autonomy amid political pressure and missing economic data.
If that independence were to be called into question, the consequences could be immediate. Investors might respond by selling US Treasuries, pushing yields sharply higher and unsettling broader markets.
In a world already on edge between optimism and uncertainty, even the perception of diminished Fed independence could be enough to spark a wave of volatility.
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