Today’s market pullback, along with NVDA’s drop, was partly blamed on Powell’s speech at the Economic Club of Chicago. But was it really that hawkish? I don’t think so.
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1. Emphasis on “Patience” – Clear Indication Against a Rate Hike
“We have ample room to wait for clearer conditions before considering any policy adjustments.”
Powell explicitly stated that now is not the time to raise rates or tighten policy.
He reiterated the Fed’s data-dependent and patient stance, showing no signal of imminent tightening.
Rather than being hawkish, it was a continuation of caution and prudence.
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2. Inflation Concerns Are from “External Shocks,” Not Monetary Policy Failure
Powell pointed to recent tariff hikes as the main source of inflationary pressure, which are supply-side, cost-push shocks, not demand-driven overheating.
Such supply disruptions don’t necessarily warrant a rate hike response.
His tone was analytical and precautionary, not action-oriented.
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3. No Change in Forward Guidance or Policy Signal
Powell didn’t update or shift the Fed’s official stance, nor did he imply any leaning toward a rate hike.
He reaffirmed the Fed’s dual mandate of “maximum employment” and “price stability.”
Some media interpreted his denial of a “Fed Put” (the idea that the Fed will always intervene when markets fall) as hawkish—but in reality, this was simply a reiteration of long-standing policy, not a signal of tightening.
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Conclusion:
The market may have overreacted to Powell’s remarks. In fact, he simply maintained a balanced, data-driven policy tone, without signaling any shift.
We are still in a “pause and observe” mode, not “tighten and accelerate.”
In fact, if the Fed were to invoke a “Fed Put” so easily, that would actually show panic, and any emergency policy cut might terrify markets more—now that would be truly hawkish.
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Note:
NVDA’s daily chart shows it’s consolidating around the 100–105 range—not necessarily weak. Also, the VIX was relatively calm today, and from a volatility cycle perspective, we’ve likely entered a mean reversion phase since April 10.
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