Opinion: Market Panic After FOMC Shows Some Overreaction
Author: Jinze Last night, the market experienced a significant pullback, primarily due to investor concerns over the Federal Reserve possibly shifting towards a more “hawkish” policy stance. This sentiment triggered widespread sell-offs, particularly in growth and tech stocks. Despite the market’s sharp reaction, I believe it’s essential to delve deeper into the current macroeconomic environment and policy dynamics, avoiding being misled by short-term fluctuations. Policy Interpretation: Hawkish Appearance vs. Underlying Logic The Federal Reserve’s signals have mainly focused on two points: “slowing the pace of rate cuts” and becoming “more data-dependent.” Powell clearly stated that the Fed would remain highly sensitive to future economic data, and while the rate cuts expected in 2025 might include three rate reductions, there is also the possibility of a pause or a change in pace. The dot plot shows three rate cuts, which is slightly more conservative than previous market expectation...