…..for now anyway. The Fed minutes from yesterday were not dovish at all. Powell is still sticking by his reason for cutting .25 bips at the last meeting by still calling it a “mid-cycle adjustment” The market wants full-blown easing over a prolonged period. and that didn’t come across in the minutes.
Also in the report, Kansas City Fed President George (FOMC voter in 2019) repeated that she was not in favor of the July rate cut and made it sound in an interview that she isn’t convinced yet that the economy needs another rate cut in September.
Philadelphia Fed President Harker (an FOMC voter in 2020) said in an interview that he does not support further stimulus to the economy right now and believes rates should stay steady.
Powell has a chance to restate things tomorrow when he speaks at 10 AM but he has to be really careful and delicate as the entire planet will be slicing and dicing every syllable.
I guess it took the market more time than normal to process some of this because we went from firmly green to firmly red on a pretty decent bearish reversal so far today.
So far gold and silver are about flat.
The bulls have been a stubborn bunch, so they could still step up and by the dip today, but there must be a boatload of “hedging” going on today (and this week) as they ready themselves for a bad or a good outcome tomorrow.
Tomorrow should be a hoot. Seats and tray tables should be in an upright position.