Powell sets the tone tonight! Under the "cooling" trend of the Fed, both US stocks and gold fall while the dollar remains strong.

Market expectations for a Fed rate cut are rapidly retreating, with U.S. stocks, gold, and U.S. Treasury bonds all falling, while the dollar stands out. Last night, three regional Fed chairmen densely released "hawkish" signals, and tonight at 22:00, Powell's speech will be key to the market's rhythm.

Three officials "doused with cold water," interest rate cut expectations plummet.

1. Schmid (19:00): Stated that there is no need to rush into interest rate cuts, the inflation risk is greater than the labor market risk, denying the speculation of "cutting interest rates in advance to stabilize employment."
2. Bostic (20:00): Only expects one rate cut this year (previous market expectation was two), emphasizing that the forecast confidence interval is large, and the rate cut may be more gradual.
3. Harmak (24:00): stated "If the decision is made tomorrow, I do not support a rate cut," reinforcing a hawkish stance.

As a result, the probability of a rate cut in September plummeted from 80% to 65%, and only slightly rebounded to 70% at the close, indicating a significant cooling in the market's rate cut sentiment.

Powell's Speech Preview: The Expectations Management Behind the "Composed Image"

Previously, the "New Fed News Agency" reported that Powell informed his colleagues that he was "under no pressure" and at 72 years old, he still maintains a regular exercise routine, suggesting that he is in good condition. This statement aims to shape the image of decision-makers as "calm and composed," conveying that the Fed will not deviate from its policy path of "anchoring inflation" due to short-term market fluctuations.

If Powell continues his hawkish stance tonight, it will further strengthen expectations of "liquidity tightening," and mainstream cryptocurrencies like BTC and ETH may come under pressure along with risk assets.
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