Walsh may turn hawkish, and the Federal Reserve's loose expectations are facing an end According to BlockBeats, on June 4th, as this month's interest rate meeting approaches, market expectations for the Federal Reserve to cut interest rates continue to cool down. Reuters columnist Mike Dolan stated that the only remaining "one rate cut within the year" expectation in the dot matrix may be completely removed, and it is not ruled out that the new chairman Kevin Walsh may push for the cancellation of the dot matrix mechanism. Currently, the AI investment boom and the situation in the Middle East are driving up energy prices, causing inflationary pressures to reignite. However, the US job market remains resilient, with 122000 private sector jobs added in May exceeding expectations. The market has begun to price up the possibility of interest rate hikes within the year. The report stated that the meeting is not expected to immediately raise interest rates, but the policy statement may further dilute the easing tendency. Several officials have previously proposed deleting relevant forward-looking guidelines, and Waller, who was once dovish, has recently shifted his support to a more conservative stance. SGH Macro Institute economist Tim Duy said that the Federal Reserve is reassessing last year's interest rate cut decision internally, and more and more officials are paving the way for future rate hikes. At the same time, Walsh hired conservative economist Paul Winfree, who had advocated weakening the Fed's employment targets, as an advisor, deepening market concerns about his hawkish stance. Analysts believe that as loose expectations recede, the Federal Reserve's policy cycle may have shifted, and volatility in the US bond and interest rate markets may significantly intensify in the second half of the year. [Original link]