"The Federal Reserve (FED) Echo Chamber": Market Overinterpretation of Hamak's June Rate Cut Remarks

GateUser-6433627c · 2025-04-25T18:39:32+00:00

The speech of Federal Reserve official Hamack was overly interpreted by the market as a possible interest rate cut in June; in fact, Hamack only mentioned considering a rate cut under "if" conditions, without explicitly stating that it would be implemented in June. The market's excessive reliance on these vague assumptions could pose risks.

GateUser-6433627c

2025-04-25 18:39:32

Abstract generation in progress

On April 26, “The Federal Reserve (FED) mouthpiece” Nick Timiraos stated that comments from FED’s Harker on Thursday attracted widespread follow, as some market participants overinterpreted them as a signal that the FED might be ready to cut rates in June. Harker did not really say that a rate cut in June is imminent; when he mentioned a June rate cut, he used the qualifying word “if” twice: “If we receive clear and compelling data before June, and if we know what action is appropriate at that point in time, then I think the committee will take action.” The danger of relying too much on these overly broad “if” assumptions is that they do not provide particularly clear answers. ( Jin10 )

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