Today's Fed decision was rather uneventful, even despite two votes for a cut, which was the first such situation since 1993. What is more, the statement itself, pointing to a slightly worse economic situation, suggested opening the door to a September cut. However, Powell's words during the conference can be considered quite hawkish.
Powell himself pointed out that the Fed is currently turning a blind eye to elevated inflation by not raising interest rates. This means that the Fed still sees considerable risk in elevated inflation. Although the Fed does not believe that tariffs will have a lasting impact on elevated inflation, it does not rule out such a scenario. Powell is not communicating that there will be a cut in September. The Fed's current stance shows some resistance to pressure for cuts. The dollar continues to strengthen after Powell's comments, and yields are also rising as the chances of rate cuts this year diminish. The market no longer prices in a high probability of two cuts this year.
Powell noted that a clearly negative signal from the labor market or a noticeable decline in inflationary pressure would be an argument for a cut. The Fed chief emphasized that the bank is closely monitoring unemployment data.
EURUSD pair drops to 100-day EMA for the first time since March 2025.
Source: xStation
Daily Summary: Technology Drives Wall Street to Record Highs Despite Tensions in the Persian Gulf
๐ด Three markets to watch next week: EURUSD, CH50cash, OIL (08.05.2026)
US Open: Earnings season and strong NFP report drive Wall Street higher!
BREAKING: American Consumers Ease Inflation Fears, But Sentiment Stays Weak
The material on this page does not constitute as financial advice and does not take into account your level of understanding, investment objectives, financial situation or any other particular needs.
All the information provided, including opinions, market research, mathematical results and technical analyses published on the website or transmitted to you by other means is provided for information purposes only and should in no event be interpreted as an offer of, or solicitation for, a transaction in any financial instrument, nor should the information provided be construed as advice of legal or fiscal nature.
Any investment decisions you make shall be based exclusively on your level of understanding, investment objectives, financial situation or any other particular needs. Any decision to act on information published on the website or transmitted to you by other means is entirely at your own risk. You are solely responsible for such decisions.
If you are in doubt or are not sure that you understand a particular product, instrument, service, or transaction, you should seek professional or legal advice before trading.
Investing in OTC Derivatives carries a high degree of risk, as they are leveraged based products and often small movements in the market could lead to much larger movements in the value of your investment and this could work against you or for you. Please ensure that you fully understand the risks involved, taking into account your investments objectives and level of experience, before trading, and if necessary, seek independent advice.
