At the Federal Reserve meeting in July, I don't think the market should be most concerned about 'not raising interest rates this time'. But rather: The Federal Reserve is clearly becoming hawkish internally. The FOMC has ultimately decided to keep interest rates unchanged, with the federal funds rate range remaining between 3.50% and 3.75%. On the surface, it appears to be a pause. But the voting result was 9:3. Three members opposed the suspension, believing that this time the interest rate should be directly raised by 25 basis points. This is the key point. If we simply hold our ground, the market may interpret it as' interest rate cuts are coming soon '. But not this time. The Federal Reserve statement continued to say that the US economy is still steadily expanding, employment growth is keeping up with labor force expansion, and the unemployment rate has not changed much. That is to say, the economy is not weak enough to require immediate rescue. Meanwhile, inflation remains above the 2% target, and factors such as energy and supply shocks, as well as the situation in the Middle East, are still disrupting prices. So what the Federal Reserve is most afraid of now is not a sudden economic recession, but inflation becoming sticky again. Walsh's speech this time was also very direct: There is no such thing as a 'soft inflation target', the target is 2%. The translation of this sentence into human language is: Don't expect the Federal Reserve to relax prematurely just because the market wants to rise. More importantly, he deliberately reduced forward guidance. Previously, the market was accustomed to listening to the Federal Reserve's hints on the next steps. Now the Federal Reserve seems more like saying: I won't give you an answer in advance, you can check the data pricing yourself. This will lead to a result: The market volatility will be greater. Due to the lack of a clear script, funds can only adjust expectations back and forth by focusing on data such as CPI, PCE, employment, oil prices, wages, and bond yields. That's also why the US stock market didn't respond well after the meeting. The three major US stock indices have all fallen, with greater pressure on technology stocks and AI related assets, and significant fluctuations in long-term US bond yields. The market is not afraid of not cutting interest rates this time. What the market fears is: The interest rate cut transaction is not going smoothly. High interest rates may last longer. Even if inflation recurs, there is still a risk of interest rate hikes in the future. For technology stocks, this signal is quite crucial. AI、 The main lines of semiconductors and cloud computing still have long-term logic. But they are very sensitive to interest rates. Because many valuations rely on future cash flows, the higher the interest rate, the greater the discount pressure on forward valuations. So after this meeting, I will focus on three things: Firstly, will PCE and CPI continue to cool down in the future. Secondly, will oil prices and the situation in the Middle East push up inflation expectations again. Thirdly, will the long-term yield of US Treasury bonds continue to suppress the valuation of technology stocks. My understanding is: This meeting is neither positive nor completely negative. It's more like telling the market: Don't trade and cut interest rates too early. The core task of the Federal Reserve now is still to push inflation back to 2%. As long as inflation does not truly fall, even if the fundamentals of technology stocks are strong, it is difficult for them to completely escape interest rate suppression. The Federal Reserve did not raise interest rates in July, but what the market heard was not easing. But rather 'longer high interest rates' and' less certainty '.