Kashkari confirms no rate cuts in January, Fed's hawkish stance remains unchanged

Federal Reserve Minneapolis Fed President Kashkari recently stated that he does not believe there is any easing motivation in January and emphasized that the current economy is showing “resilience.” This statement further confirms the Fed’s hawkish stance on monetary policy, dampening market expectations for a rate cut in the near term. Against the backdrop of continued positive economic data, the Fed’s determination to maintain high interest rates clearly remains unchanged.

Federal Reserve Policy Stance Reaffirmed

Kashkari’s remarks represent the mainstream voice within the Federal Reserve. As an important member of the Fed’s decision-making body, his views often reflect the policy direction of the Federal Reserve. The statement “not believing there is any easing motivation in January” is very clear, implying that a rate cut in the January policy meeting is almost impossible.

Economic Resilience Is the Key Support

Kashkari emphasized that the economy’s “resilience” is the core reason for the Fed to maintain high interest rates. Although the US economy faces certain pressures, the labor market remains robust, and consumer activity stays active. These factors support the Fed’s continued stance on current interest rates. Economic resilience means the Fed has no urgent reason to cut rates.

Market Rate Cut Expectations Continue to Adjust

According to relevant information, several other Fed officials, including Powell, Mester, and Williams, are scheduled to speak in the coming days. These series of speeches may further reinforce market perceptions of the Fed’s policy stance. Previously, market expectations for rate cuts have been repeatedly challenged, and Kashkari’s recent comments may once again prompt investors to adjust their expectations for the rate cut pace this year.

Potential Impact on the Crypto Market

The Fed’s maintenance of high interest rates is generally unfavorable for risk assets. Cryptocurrencies, as high-risk assets, face pressure under the Fed’s hawkish stance. A high interest rate environment increases the opportunity cost of holding cryptocurrencies like Bitcoin, as investors can achieve better returns through low-risk assets. Additionally, the elimination of policy uncertainty may lead to reduced market volatility, which presents both challenges and opportunities for traders.

Follow-up Focus

In the coming weeks, the Fed will continue to release economic data and officials’ speeches. US November retail sales, PPI, and other economic indicators will be announced later today, and these data may further reinforce or weaken the Fed’s hawkish stance. Investors need to closely monitor these data and subsequent speeches to update their judgments on the Fed’s policy path.

Summary

Kashkari’s remarks further confirm that the Fed will not cut rates in January, reflecting the Fed’s assessment of economic resilience. Although market expectations for rate cuts have been present, the Fed’s stance now appears quite clear. For the crypto market, the high interest rate environment remains a primary pressure, but the clarity of policy direction also alleviates some uncertainties. The key going forward is to observe whether economic data will change the Fed’s outlook.