Saxo Market Call Snappy FOMC takeaways versus seeing the forest for the trees
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Sep 18, 2025 Markets were searching for clarity post-FOMC, but the landscape remained largely unchanged, leaving investors to ponder their next moves. Discussion included the potential overreach of equity investors and the impact of upcoming central bank meetings. The Japanese yen reached new lows, prompting analysis on its implications. Insights into individual stocks like NVIDIA and upcoming earnings were also highlighted, alongside speculative trends in the tech sector, including Meta's latest innovation.
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Fed Move Confirmed But Market Reverted
- The FOMC meeting produced a 25bp cut and an 11-1 vote, but the broader message didn't materially change the policy path.
- Markets briefly overreacted then largely reverted, leaving the macro outlook intact.
Dot Plot Reveals Committee Divisions
- The dot plot showed distinct clusters: a single 50bp outlier, a majority expecting three 25bp cuts, and some expecting only one cut or even a hike.
- This dispersion highlights lingering committee uncertainty and different risk management approaches.
Dovish Fed Despite Stronger Growth Forecasts
- The Fed projected stronger GDP and lower unemployment yet signaled rate cuts, which is a dovish combination.
- That suggests policy is responsive to funding dynamics and debt financing needs rather than just growth.