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on wednesday, september 18, after the federal reserve cut interest rates by 50 basis points in line with market expectations but also beyond traditional steps, federal reserve chairman powell held a much-anticipated press conference.

as he said the fed was not in a hurry to cut interest rates, he also warned against seeing large rate cuts as a regular rhythm in the future.the hawkish tendency in the speech caused the three major u.s. stock indexes to turn from rising to falling, and the u.s. treasury yields also erased the decline after the fed's decision and turned back to rising, and gold rose and fell.

how to understand the sharp interest rate cut? it is not a new normal rhythm in the future. the fed is not in a hurry to cut interest rates, which does not mean that the risk of recession is high.

one of the most frequently asked questions for powell at the press conference was why the fed cut interest rates so sharply, whether it was acknowledging that it should have cut interest rates in july but was now behind the curve, and whether it was emphasizing that the risk of a downturn in the u.s. economy was high.

powell admitted that "it was indeed possible to cut interest rates in july, but we didn't actually do that." but he denied that the fed had delayed the rate cut for too long and did not think that the action lagged behind the interest rate curve. this rate cut was precisely "a reflection of the fed's commitment not to lag behind the economic situation."

his reasoning was that, given the outlook, the fed was “very patient and waited” on monetary policy, even though other major central banks around the world had previously cut rates, and that this wait eventually paid off, convincing the fed that inflation would continue to fall back to 2%: