In a recent speech, Powell further emphasized that the Fed's stance remains tight after the rate cuts, believing that the current interest rate level "is still slightly above neutral." This means that even after implementing easing measures, the overall financial environment still has the effect of suppressing inflation. He specifically mentioned that there is "room for further adjustments" in policy but will not preset a path, instead acting flexibly based on future employment and inflation data. This statement reinforced the market's perception of "gradual easing," weakened expectations for excessive easing, and also left room for maneuvering in the fourth quarter market.

Previously, the Fed decided to cut interest rates by 25 basis points at the September monetary policy meeting, marking a significant shift in monetary policy since the start of this tightening cycle. The market had already formed high expectations for this action, but Chairman Powell conveyed that the message was more complex than simply a rate cut in his subsequent speech. He repeatedly emphasized the existence of "two-way risks" in his remarks: on one hand, if the signs of weakness in the labor market continue to deepen, the Fed needs to further release easing to prevent the unemployment rate from rising too quickly, which would undermine the economy's long-term growth potential; on the other hand, if inflation fluctuates after nearing the target, the monetary authorities also need to remain vigilant to avoid excessive easing that could lead to a resurgence in price levels.

Powell acknowledged that even after a rate cut, the Fed is still "in a favorable position," which means that policymakers want to retain flexibility and are unwilling to let the market bet prematurely on a rapid easing one-way path.