25bps was the minimum cut the FED could do politically so that’s what they did. A confusing presser didn’t help where, normally, the eloquent Powell couldn’t explain some of the decisions.
Market reaction was USD up and long rates up too.
If the idea was to placate Trump then the FED achieved the worst possible result.
If the idea was to cut rates into employment weakness the they’d better have more credible data than the rubbish the BLS has been producing, but they don’t.
If the idea is to maintain price stability then cutting into rising inflation clearly isn’t a good idea.
DXY Daily
US 10 Year Government Bond Yield Daily
