The Federal Reserve's mouthpiece highlights four key points from Jerome Powell's press conference; analysts interpret: no hawkish signals observed.

The Fed Chair reiterates that inflation has significantly retreated but remains above the 2% target, with recent progress stalling; although the labor market continues to cool, it is doing so more slowly than expected, and overall remains resilient. Powell has repeatedly emphasized that the Federal Reserve is currently “well positioned to wait for more data,” almost declaring that the “policy recalibration phase” in 2025 is nearing its end, and future actions will depend entirely on economic data rather than preset paths.
(Background: The Fed cut interest rates by 1 basis point as expected! The dot plot shows only one rate cut in 2026, Bitcoin and Ethereum fluctuate wildly, and U.S. stocks rose intraday)
(Additional context: The printing presses are back on! The Federal Reserve has launched the “Reserve Management Purchase Plan,” buying $40 billion in short-term government bonds within 12/12 over the next 30 days)

The U.S. Federal Open Market Committee (FOMC) concluded a two-day policy meeting in the early morning of December 11 Taiwan time. As expected by the market, it announced a 25 basis point (1 basis point) reduction in the federal funds rate target range to 3.50%–3.75%. This is the third rate cut since 2025, but the voting result was 9:3, indicating serious internal disagreements.

Key points from Powell’s press conference

Following the meeting, Federal Reserve Chair Jerome Powell held a press conference. He reiterated that although inflation has fallen sharply, it remains above the 2% target, with recent progress stalling; the labor market continues to cool but more slowly than expected, and overall remains solid. Powell repeatedly emphasized that the Fed is “well positioned to wait,” almost declaring that the “policy recalibration phase” in 2025 is nearing its end, and that future actions will depend solely on economic data, not predetermined paths.

In response, Nick Timiraos of The Wall Street Journal, often called the “voice of the Fed,” summarized four key points from Powell’s press conference on X platform:

2. Powell almost declared that the “policy recalibration phase has been completed”— they are now “well positioned to observe and wait.”
3. He attributed the internal disagreements within the committee to abnormal tension arising from the dual mandate (employment and inflation), and acknowledged that both sides’ viewpoints are reasonable.
4. He unexpectedly pointed out that employment growth might appear negative due to measurement issues, stating: “The gradual slowdown in the labor market is ongoing, just slightly slower than expected,” reducing concerns about inflation in the service sector.
5. Even though rates are closer to neutral levels, raising interest rates is not a baseline scenario for anyone. Currently, members’ opinions range from “that’s it” to “need to cut again,” but no one expects rate hikes as the main outlook.

Key takeaways from Powell’s presser:

-Powell more or less declared the recalibration phase complete—they’re now “well positioned to wait.”

-He blamed committee divide on the unusual tension in the dual mandate and validated both sides of the debate.

-He made a surprisingly…

— Nick Timiraos (@NickTimiraos) December 10, 2025

Analyst interpretation: No hawkish signals seen

Regarding Powell’s remarks, analyst Anna Wong pointed out that although the dot plot shows only one rate cut in 2026, the overall policy statement and economic forecasts remain dovish—significantly raising the 2025 economic growth forecast, lowering inflation projections, and announcing the launch of the reserve management bond purchase plan.

Meanwhile, Informa Global Markets succinctly commented on Powell’s speech:

“The so-called ‘hawkish rate cut’ is just that.” (Earlier market expectations expected the Fed to implement hawkish rate cuts.)

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Tags: FOMCNick Timiraos labor market Federal Reserve inflation rate cut 25 basis points Powell hawkish dot plot