On the 20th, due to the U.S. official labor data leading to a general market prediction that the Federal Reserve would no longer continue to cut interest rates, the U.S. stock market experienced a widespread decline. However, according to a report by the UK's Financial Times on the 21st, after New York Fed President John Williams publicly expressed support for rate cuts, the U.S. stock market responded "immediately," with the Nasdaq Composite Index, mainly composed of technology stocks, rising 0.9%, while the broader S&P 500 Index rose 1%. The non-essential consumer, healthcare, industrial, and technology sectors all saw significant gains.

New York Fed President John Williams stated on the 21st that he would support a 25-basis-point rate cut at the upcoming meeting of the Federal Reserve and said that short-term borrowing costs "still have room for further adjustments." This led the market to generally believe that Federal Reserve Chair Powell would support pushing for a third rate cut.

New York Fed President John Williams Bloomberg

Krishna Gohal, vice president of the renowned international investment bank and financial research institution Evercore ISI, believes this is a clear signal from the Federal Reserve: "Although Williams may be expressing his personal opinion, the signals from the other two members of the Federal Reserve leadership trio on key real-time policy issues are almost always approved by the chair."

According to data tracked by the Chicago Mercantile Exchange Group on federal funds futures, the market's expectation of a December rate cut exceeded 70% on the 21st, compared to about 40% on the 20th.

American short-term Treasury prices, which are sensitive to monetary policy expectations, also rose on Friday. The two-year U.S. Treasury yield fell 0.04 percentage points to 3.51%. Yield and price movements are inversely related.

Andy Brenner, head of international fixed income at the financial services company NatAlliance Securities, said: "Williams mentioned the possibility of a December rate cut this morning... That's why the stock market and Treasury prices went up."

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