The Federal Reserve's rate cut decision just announced, but the market's reaction is quite the opposite.

The current round of the Federal Reserve's expected 25 basis point rate cut was implemented as scheduled, but the accompanying dot plot delivered a cold shower to the market—only one more rate cut is planned before 2026. This statement caused market expectations to shift sharply, with U.S. Treasury yields breaking through the 4.2% threshold, turning the initial rate cut positive sentiment into negative.

Political pressure and market difficulties are arriving simultaneously. Trump immediately issued strong remarks, directly criticizing the Fed's rate policy for dragging down economic performance. He even brought up old issues—overruns of $2.5 billion on the Fed building renovation project. More directly, he hinted that if the Fed does not adopt more aggressive rate cuts, personnel changes could occur in 2025.

Powell finds himself in a dilemma. With only five months left in his term, he must endure political pressure on one side and the spreading market panic on the other. The Fed's long-standing independence is under severe test.

From a financial market perspective, analysts express concern. If central bank decisions become pawns in political games, the downward space for long-term U.S. bond yields will be severely limited. The dual effects of inflation expectations and risk premiums could push yields to 4.5% or even higher.

The current situation is thought-provoking—rate cut expectations have become a bubble, yet the stage is fully occupied by political drama. The bond market is oscillating at high levels, and market sentiment is entirely dependent on policy signals.

In trader circles, there is no shortage of dark humor: by May 2026, when Powell leaves office, market reactions could be vastly different. Whether the market relaxes or descends into further chaos will depend on the subsequent decision-makers' choices. This confrontation between central bank independence and political pressure is unfolding a real-life financial drama.

For cryptocurrency market participants, the uncertainty of Fed policies also presents challenges. Macroeconomic fluctuations often influence the flow of risk assets, making it especially crucial to grasp market rhythm and track policy developments.