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

The current round of the Fed's expected 25 basis point rate cut was implemented as planned, 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. The initial positive outlook on rate cuts instantly turned into a negative signal.

Political pressure and market difficulties are arriving simultaneously. Trump immediately issued strong remarks, directly blaming the Fed's interest 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 faces pressure from the political side on one hand, and the spreading panic in the market on the other. The Fed's long-standing independence is being severely tested.

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

The current situation is intriguing—expectations for rate cuts 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.

Within trader circles, there is dark humor: by the time Powell leaves office in May 2026, 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 into a real-life financial drama.

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