Recently, Federal Reserve Chair Powell's actions are indeed worth pondering. On one hand, inflation data has clearly been declining, yet there is an overly cautious stance on interest rate cuts. This dilemma is profoundly affecting the rhythm of the crypto market.

Let's first look at the immediate inflation data. The latest US CPI is at 2.7%, roughly in line with expectations, but that's not the key point—core CPI has fallen to 2.6%, even lower than expected. More importantly, this set of data shows almost no difference from the previous increase. The once fierce inflation momentum has long since faded; now, it’s at most a slow, moderate rise in prices.

There is a particularly interesting detail. Using Truflation’s real-time inflation tool, the actual inflation rate in the US has already dropped below 1.8%. What does this mean? It indicates that it is now below the Federal Reserve’s 2% official target. According to conventional logic, since inflation is no longer a problem, the tight grip of high interest rates should loosen—after all, high rates suppress corporate financing costs, and market liquidity is also contracting.

But the reality is that Powell has been hesitant to cut rates. This contradiction is evident, and the crypto market has started to fluctuate due to this uncertainty. Many are wondering whether policy will continue to tighten or suddenly shift at some point. This ambiguity in expectations is the root cause of recent market volatility.

From another perspective, on the data level, inflation has indeed met the target, but from a decision-making standpoint, Powell seems more concerned with avoiding the risk of inflation rebound. This is the current dilemma—data says one thing, policy does another. For us, the key is to understand the logic behind this so we can anticipate the window for future policy shifts.