2026-01-02 03:25:56

The New Year has just begun, and the Federal Reserve has poured cold water on the market. The latest interest rate range is locked at 3.50%-3.75%, and that 25 basis point rate cut at the end of last year seems to have been just a "courtesy move." Economic data are clear, and the central bank's stance is also very clear: the days of large-scale liquidity injections are over.

Let's first look at the real picture of the December dot plot. There may only be room for a 25 basis point rate cut for the whole year. Inflation is stuck at 2.4% and refuses to come down, while GDP growth remains steady at 2.3%. What does this data mean? The economy is not weak enough to require a large rate cut, and inflation is not low enough to reassure the Federal Reserve. Even dovish observers are sighing.

Wall Street is already in a state of chaos. Goldman Sachs and Morgan Stanley expect two rate cuts, while JPMorgan is conservative and only dares to bet on one. Even more exaggerated, some in the market are shouting "zero rate cuts this year," and others are dreaming and guessing "a furious 150 basis point cut." The divergence is so absurd.

The biggest variable to watch is May. If Powell hands over the baton to dovish representative Harker, the entire game rules could be rewritten.

The most critical point now is the January FOMC meeting. Every move of the median dot in the dot plot will determine the liquidity trend for the year. Holding steady or raising the rate means hawkish forces still dominate; an unexpected cut could trigger a dovish rally. Both stocks and cryptocurrencies need to buckle up.

The logic is actually simple: inflation is sticky, the economy is resilient, and the Federal Reserve won't be soft. Unless unemployment suddenly skyrockets or inflation crashes, "slow rate cuts" will be the main theme this year.

In terms of operations, don't rush too much. Wait until the first wave of emotional shocks passes and the market digests this wave of expectations, then calmly consider deployment. In a year of liquidity turning points, opportunities often hide in the market's unanticipated expectations.

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RetiredMiner

· 7h ago

The hawks have won again, and our group of retail investors have suffered heavy losses. In that crucial move in May, the probability of Hasset's rise to power was really low. I bet Powell will continue to be tough.

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SybilAttackVictim

· 7h ago

Hawkishness is really fierce; the big water dream has been shattered.

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SerumSurfer

· 7h ago

The hawkish stance is really fierce. Now everyone has to tighten their belts. Don't even think about slowing down the interest rate cuts.

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StableBoi

· 7h ago

Coming back with the same routine? Last year's 25 basis points was just for show. This year, the Federal Reserve is determined not to loosen its stance. The dovish folks can accept it. The hawks have won big, and those of us holding positions still need to endure. Wait, if there's really a change in personnel in May, the entire game plan will have to be recalculated, which is a bit uncertain. The January FOMC was the real watershed; how the dot plot moves will determine whether the crypto market will be in a frenzy or scatter in panic for the whole year. In simple terms, it's just two words: wait. Don't get caught by the first wave of the market; the expectation gap is the real gold.

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0xLuckbox

· 7h ago

Another year begins, and the Federal Reserve has started to make moves. That 25 basis points is really just a tip of the hat to begging, hilarious. Hawkish and tough, dovish and laying low, centrists each making up stories. A 150 basis point sharp cut? Dream on, buddy. May is a critical point. Once Hasset takes office, the story will have to change. By then, the game rules will likely be reversed. The January FOMC just needs a quick glance; whether the dot plot shows big movements or not will directly determine whether cryptocurrencies rise or fall this year. Inflation is sticky as hell, and the economy is also very resilient. The Fed's stance is extremely tough, unless the unemployment rate explodes. There's no need to follow the trend now. Let the market digest this wave of expectations first. The real opportunity lies in the expectation gap. Just waiting.

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JustHereForAirdrops

· 8h ago

The Federal Reserve really can break people's defenses. Where's the promised rate cut? Instead, they just gave a 25 basis point hike as a gift?

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