Rates Spark: A dovish 25bp or a hawkish 50bp rate cut | Metals Mine

Rates Spark: A dovish 25bp or a hawkish 50bp rate cut | Metals Mine

Rates Spark: A dovish 25bp or a hawkish 50bp rate cut

From think.ing.com

Wednesday will see the Fed deliver an interest rate cut, most likely 25bp. It's fully priced. So, material market impact would have to come from either a surprise 50bp cut, or commentary from Chair Powell that swings dramatically in either a decidedly hawkish or dovish direction. A 25bp cut gives room for a somewhat dovish leaning, while a 50bp cut would allow Chair Powell to be as hawkish as he likes, as the move itself would dominate aggregate impact. Until or unless we get to an inflation hiccup of significance, the prognosis for the front end is pretty straightforward, as it will remain slavish to the trend lower ... (full story)

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Sep 17, 2025 4:41am

Wednesday will see the Fed deliver the customary ritual: a 25 basis point interest rate cut. The event is so entirely priced in that the market's reaction is likely to be a collective shrug, with volatility having been siphoned out weeks ago by anticipatory positioning.

Therefore, to jolt this narcotized market from its lethargy, the material impact will have to emanate from one of two catalysts:

A surprise 50bp cut—an act of dramatic monetary panic that would send algorithmic systems into a temporary buying frenzy, only for them to sober up and question the rationale moments later.

A masterclass in Delphic ambiguity from Chairman Powell. His commentary would need to swing so dramatically in either a hawkish or dovish direction that it fundamentally rewrites the expected policy path, providing the narrative shock the market craves.

The standard 25bp cut affords Powell room for cautiously dovish leanings—a "we're doing this, but we're not happy about it" stance designed to disappoint everyone equally. Conversely, a 50bp cut would grant him the license to be as hawkish as he desires; he could announce the cut while reading excerpts from Das Kapital backwards, and the market, intoxicated by the liquidity, would applaud regardless.

Until we are confronted by a significant inflation hiccup—likely triggered by the economy reaching peak avocado toast pricing—the prognosis for the front end is a straightforward and slavish adherence to the trend lower. It remains a well-trained dog, heeling to the master's narrative, never daring to sniff at another fire hydrant.

In summary: buy the rumor, sell the news. And keep the Alka-Seltzer handy.

4

Sep 17, 2025 4:05am

Quoting Trader#EEC5

Disliked

What do you think, should I buy or sell? Can anyone suggest?

Ignored

If you need to ask that in a public forum, then trading is not for you.

1

7

Sep 17, 2025 9:07am

Almost 1 year ago to the day, JPow dropped the ffr 50 bps and the (stock) markets tanked. And then rallied hard the next day, and continued trending upward thereafter. As a trader, I am guarding against wishful thinking, the wish being omg I would just like to see the market move, to be shaken out of its "narcotized" state (thanks, 19monza64)....so I am positioned for a good sized move in either direction, but I won't be surprised by a nothingburger, either. As per 1 year ago, the better and more obvious trades may be seen after the dust clears....tomorrow.

2

Sep 17, 2025 6:05am

Quoting DwnUndrTrdr

Disliked

{quote} Well written and nice summation. If you had a newsletter, on that piece, I'd be a subscriber.

Ignored

It was an ecclesiastical mix of financial wizardry .

We have a true poet Laureate (with a touch of Billy Connolly thrown in ) amongst us . Not sure I’d subscribe to a newsletter , but a far better read than Viz .

A savvy investor with a sense of humour , what more can you ask for .

1

Sep 17, 2025 7:41am

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Sep 16, 2025 11:54pm

With good retails sales, FED will adopt a precautionary stance. That is Dot plot showed 1 cut in 2025, and open for 2026. Making market to priced out

3

Sep 17, 2025 6:25am

Quoting Vancarbon

Disliked

{quote} It was an ecclesiastical mix of financial wizardry . We have a true poet Laureate (with a touch of Billy Connolly thrown in ) amongst us . Not sure I’d subscribe to a newsletter , but a far better read than Viz . A savvy investor with a sense of humour , what more can you ask for .

Ignored

Viz...

. And apologies, I wouldn't wish to sound as I was promoting a commercial enterprise without FF receiving their pound of flesh. It was a succinct and bouncy piece. Nice pre market tonic.
Now, back to the main course..

1

Sep 17, 2025 1:04am

I have to guess it will be a hawkish 25bps cut, with a less aggressive dot plot than markets might like to see, so sell the news.

1

Sep 17, 2025 6:31am

Hello

If you have the ability to take risks, enter this game, which is not a risk but only gambling, and if you don't, just observe. At this stage, there is always a 50% chance of getting rich, which takes control of the brain and leads to wrong decisions. If you enter, I wish you wealth.

1

Sep 17, 2025 9:41am

Quoting The Fool

Disliked

Almost 1 year ago to the day, JPow dropped the ffr 50 bps and the (stock) markets tanked. And then rallied hard the next day, and continued trending upward thereafter. As a trader, I am guarding against wishful thinking, the wish being omg I would just like to see the market move, to be shaken out of its "narcotized" state (thanks, 19monza64)....so I am positioned for a good sized move in either direction, but I won't be surprised by a nothingburger, either. As per 1 year ago, the better and more obvious trades may be seen after the dust...

Ignored

So true.

Sep 17, 2025 9:45am

Quoting The Fool

Disliked

Almost 1 year ago to the day, JPow dropped the ffr 50 bps and the (stock) markets tanked. And then rallied hard the next day, and continued trending upward thereafter. As a trader, I am guarding against wishful thinking, the wish being omg I would just like to see the market move, to be shaken out of its "narcotized" state (thanks, 19monza64)....so I am positioned for a good sized move in either direction, but I won't be surprised by a nothingburger, either. As per 1 year ago, the better and more obvious trades may be seen after the dust...

Ignored

I noticed you've ignored 1815 traders; and I found me to be one of them. What a pity!!

Sep 17, 2025 4:40am

Quoting LightchaserG

Disliked

IMO this will be happening from sentiments around there: 0.25 = Bearish 0.50 = Bullish will drop and ATH

Ignored

A 50bps cut is more bearish than a 25bps cut. It will signal that the Fed thinks the economy is in an even weaker state than thought. Yields will fall, other currencies will rally vs the dollar. A hawkish dot plot @ 25bps on the other hand, may be slightly bullish initially whilst the market digests.

Sep 17, 2025 7:33am

Quoting The Fool

Disliked

I have to guess it will be a hawkish 25bps cut, with a less aggressive dot plot than markets might like to see, so sell the news.

Ignored

Agreed, I'm leaning slightly to a surprise.

Sep 17, 2025 4:29am

25 is more likely and seems more prudent, but 50 is absolutely a possibility
But there is way too many moving parts, besides just the usual market mechanics. What will Powel want to do, piss Trump, appease Trump? Does Trump already have Powel by the balls?

Sep 17, 2025 6:41am

What Trump Powell wars? Powell is a lame duck who is more concerned about his legacy than the economy.

0.25% - 100% guaranteed
0.5% rate cut - highly unlikely due to reasons another poster so eloquately wrote.

This "Trump-Powell War" as you suggest resembles the Russia-Ukraine conflict - When 1 side is more powerful than the other the end result is predictable; however delayed.

I expect today the price to either spike up/down but by 17:00 EST EU should be within 20 pipis of where it was now...Just guessing based on prior experiences - not on S/R or ADR

Sep 17, 2025 5:09am

Quoting 19monza64

Disliked

Wednesday will see the Fed deliver the customary ritual: a 25 basis point interest rate cut. The event is so entirely priced in that the market's reaction is likely to be a collective shrug, with volatility having been siphoned out weeks ago by anticipatory positioning. Therefore, to jolt this narcotized market from its lethargy, the material impact will have to emanate from one of two catalysts: A surprise 50bp cut—an act of dramatic monetary panic that would send algorithmic systems into a temporary buying frenzy, only for them to sober up and...

Ignored

Well written and nice summation. If you had a newsletter, on that piece, I'd be a subscriber.

Sep 17, 2025 1:25am

Quoting thebigshot

Disliked

With good retails sales, FED will adopt a precautionary stance. That is Dot plot showed 1 cut in 2025, and open for 2026. Making market to priced out

Ignored

Agree - Everyone is looking to sentiment, partly on a Dovish committee hearing last time around but more so, the narrative being craft by TACO and his rage bait.

From a Fiscal Policy to the Dual Mandate, a 50bps cut isn't even on the cards. FED are on course, meandering and certainly in no rush. Moreso, Fiscal Policy would benefit from holding as is/ standing firm.

Giving this article/ analysis a third option: Hold Rates As Is.

1

Sep 17, 2025 1:26am

who cares? buy the rumour, sell the news

1

Trader#620F

Sep 17, 2025 4:23am

Quoting Trader#339A

Disliked

This is a sad day for the US Fed. It is the day it has lost its true independence and given in to political pressure. Ex-Fed Chair Paul Volcker must be looking down in horror as the Fed cuts rates into a potential inflationary headwind driven by tariffs.

Ignored

Volcker would have hiked rates to 20%, caused recession/deflated the bubble/returned the purschasing power that was lost back to the currency and voila! Current Fed is... I don't know... stupid? Paid by rich not to hike rates so stocks can continue to surge? Paid by economic forum to keep destroying the USD, so they can implement a new digital system with the new currency? Powell was a lawyer, so his knowledge about the economy and finance may not be there? Couldn't see that inflation wasn't transitory and now can't see the labor market is in a collapse? I don't know exactly what the agenda is, but it seems they're working hard on destroying the USD just as other central banks are working to destroy their product (ECB Euro, BOE Pound, BOJ Yen...).

Also, central banks are hoarding gold while they continue to debase their currency. Does noone see a problem here? People go to jail for this, but since it's the Fed (by Fed I mean rich), then it's all right. They can commit fraud, steal and do whatever they want.

1

Sep 17, 2025 7:59am

Powell would like to please Trump and get him off his back, but on the other hand the decision of a rate cut isn't vested in him alone.

Sep 17, 2025 4:03am

IMO this will be happening from sentiments around there:

0.25 = Bearish
0.50 = Bullish

will drop and ATH

Trader#0F75

Sep 17, 2025 12:35am

gold will touch new ATH

2

Trader#339A

Sep 17, 2025 12:12am

This is a sad day for the US Fed. It is the day it has lost its true independence and given in to political pressure. Ex-Fed Chair Paul Volcker must be looking down in horror as the Fed cuts rates into a potential inflationary headwind driven by tariffs.

1

1

Sep 17, 2025 4:19am

I think fed rat cut 0.50

Trader#B39D

Sep 17, 2025 5:47am

retail sales confirmed 25BP not likely to see a 50BP cut. i agree with some in here who believe might not be a good idea. US economy under stagflation meaning "persistent high inflation combined with high unemployment and stagnant demand in a country's economy."

best to use Supply side economics as evident from Reagan's knowledge.

Trader#5A6C

Sep 17, 2025 5:47am

Quoting Polimini

Disliked

25 is more likely and seems more prudent, but 50 is absolutely a possibility But there is way too many moving parts, besides just the usual market mechanics. What will Powel want to do, piss Trump, appease Trump? Does Trump already have Powel by the balls?

Ignored

Neither, What Powell wants to do is Ignore trump. And ignore all others that continue to try to influence their decisions and try to destroy fed independence. Trump is just another person in the peanut gallery as far as Powell is concerned (I believe)

Sep 17, 2025 7:29am

Anyone else think the Powell will simply maintain the pause? Seems like a more realistic scenario.

Sep 17, 2025 7:48am

Well put together sir, Thankyou very much

Sep 17, 2025 7:50am

Dovish hold is the play

Sep 17, 2025 8:03am

Powell wants to please his insiders like everyone else behind closed doors as they snicker and sneer at Trump and applaud Powell for not "bending" to a tyrant.

Trader#620F

Sep 17, 2025 1:47am

My bet is utterly dovish 25bps cut or 50bps cut. It is September after all... a month full of surprises for the US.

Trader#B81D

Sep 17, 2025 2:19am

I got news, that there would be NO CUT!!

Trader#EEC5

Sep 17, 2025 2:21am

What do you think, should I buy or sell? Can anyone suggest?

Trader#620F

Sep 17, 2025 3:24am

Quoting Trader#B81D

Disliked

I got news, that there would be NO CUT!!

Ignored

As Trump would say... FAKE NEWS!

Trader#32D5

Sep 17, 2025 4:04am

What's the rumour? And wht's the news ?

Trader#647F

Sep 17, 2025 4:12am

anyone tell me wheres market movesss

Trader#ED41

Sep 17, 2025 5:09am

They want the USD to go up.

Trader#833D

Sep 17, 2025 7:37am

It will be 25bps, which will drive USD down further, and another 25 bps in December. Either way dollar is falling to 90 price area. Eurusd, going to 1.24-1.25.

Trader#18F6

Sep 17, 2025 3:39pm

Can you please tell me why 50 bp is hawkish and 25 bp is bearish?

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