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Fed decision preview: If only 25 basis points of interest rate cut, the US dollar may rebound
3hours ago

According to foreign media analysis, the US dollar index is currently hovering near a 41-month low, the S&P 500 and Nasdaq have both hit record highs, and US Treasury yields are near their April lows. Market pricing fully reflects expectations of a 25 basis point rate cut from the Federal Reserve. Amid dovish expectations and a continued decline in the US dollar, if the Fed only implements the expected 25 basis point rate cut, a "buy the expectations, sell the facts" reaction is likely to occur, with the US dollar appearing poised for a rebound and US stocks potentially facing profit-taking. To sustain the dollar's decline and the rise in US assets, a 50 basis point rate cut and Fed Chairman Powell's endorsement of expectations for significant easing may be necessary. While the market places only a 3% probability on a 50 basis point rate cut, the possibility cannot be ruled out: a record downward revision to US jobs data could force the Fed to act. (Jinshi)