The latest released dot plot is a positive signal for the market, especially in the context of the current widespread pessimistic expectations. The market originally expected only one rate cut this year, but the dot plot has adjusted the expectation to two, indicating that The Federal Reserve (FED) is gradually shifting its stance. The current focus has turned to confirming the timing of the rate cut—whether the first cut will occur in September or October.

If we expect the interest rate cut cycle to begin in July, then the economic data after June must show a significant deterioration trend; only in this way can it prompt Powell to adjust the policy stance. Another possibility is that the Federal Reserve actively creates a slightly weak economic environment to pave the way for a rate cut in July, but the probability of this strategy being realized is very low, so we should not have overly high expectations for an early rate cut.
From Powell's statements, the U.S. economy remains relatively healthy, and there is no urgency to cut interest rates; The Federal Reserve (FED) can continue to maintain a wait-and-see approach. While policymakers will continue to monitor various data and weigh them cautiously, a rate cut in the second half of the year is basically determined, with the next key issue being to specify the exact month. Investors should focus on the non-farm payroll reports in the coming months, which will become an important reference indicator for FED decision-making.