Welcome back to The Breakdown with me, NLW.

It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.

What's going on, guys? It is Thursday, August 1st, and today, of course, we are catching up on the FOMC meeting.

Before we get into that, however, if you are enjoying the breakdown, please go subscribe to it,

give it a rating, give it a review, or if you want to dive deeper into the conversation,

come join us on the breakers discord. You can find a link in the show notes or go to bit.ly slash breakdown pod. Well friends, the July FOMC meeting saw the Fed hold rates steady, but they appear to be right

on the precipice of delivering their first rate cut.

If no surprises show up in economic data, Jerome Powell said, quote, a rate cut could be on

the table at the September meeting.

There was a sense that the tone has shifted right from the start of the

day. The policy statement, which is released ahead of the press conference, had a number of significant

changes compared to last month. A moderation in job gains was acknowledged for the first time,

as was an increase in unemployment. A reference to being highly attentive to inflation

risks was removed, in favor of framing the FOMC as, quote, attentive to the risks of both sides

of its dual mandate.

Powell continued this theme into the press conference describing everything in terms of the balance

of risks. He said, we know that reducing policy restraint too soon or too much could result

in a reversal of the progress we have seen on inflation. At the same time, reducing policy restraint

to later too little could unduly weaken economic activity and employment.

Powell was careful to emphasize that policy decisions are still being made meeting by meeting

in a data-dependent manner. However, the focus was on the Fed being well positioned to respond

to an unexpected weakening in the labor market or rapidly falling inflation.

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