The Federal Reserve is conducting a review of its monetary policy frameworkFirstly, the adjustment and update of the monetary policy framework this time mainly includes three aspects: one ️⃣ Maximum employment: FOMC emphasizes that monetary policy decisions will be made based on its assessment of the maximum level of underemployment (previously known as the degree of deviation from the maximum level) two ️⃣ Price stability: The FOMC has adjusted its strategy to achieve its long-term inflation target of 2%, stating that it "seeks to achieve a long-term target of an average inflation rate of 2%" and that "after a period of sustained inflation below 2%, appropriate monetary policy may aim to achieve inflation above 2% for a period of time" three ️⃣ The FOMC acknowledges the challenges posed by the sustained low interest rate environment to monetary policy, and in the United States and around the world, monetary policy rates are more likely than ever to be limited by the lower bound of effective interest rates At the September 2020 interest rate meeting, the FOMC also issued detailed guidance stating that they expect to maintain the benchmark interest rate close to zero "until labor market conditions reach a level consistent with the committee's assessment of maximum employment, until inflation rises to 2% and steadily exceeds 2% over a period of time ‼️ Many students may not understand the complex descriptions above: I have previously discussed that the Federal Reserve's monetary policy decisions mainly revolve around its dual mission of controlling inflation and maintaining maximum employment. Satisfy the condition of 4+2 Unemployment rate: An increase in unemployment rate usually indicates an economic slowdown and requires interest rate cuts to stimulate economic growth. If the unemployment rate significantly increases, such as exceeding 4.5% or 5%, the Federal Reserve may consider cutting interest rates. CPI: CPI is close to or below the target level (2%) and continues to decline, indicating an increase in deflationary pressure and the need to stimulate consumption and investment through interest rate cuts. If CPI remains below 2%, the Federal Reserve may consider cutting interest rates. But if we adjust this monetary policy framework now, it's like leaving a loophole: A dozen or so members of the Federal Reserve will hold a meeting, cast a vote, and come up with a new policy: 🚩 The claim that "tracing back to the average inflation target range of 2%" is invalid, 🚩 Add priority to the demand for employment stability 🚩 Establish standards such as' strong control over QE and timely prevention of QT '. So they can decide whether to cut interest rates based on market conditions and political needs, instead of the previous rigid 4+2 conditions. Due to the fact that 4+2 is no longer sufficient to cope with the current situation of the US economy. The Federal Reserve is highly likely to launch a new monetary policy framework in the second half of this year I personally think it is mainly due to three reasons: 1. It may be difficult to change the direction of monetary policy in the short term according to the old monetary policy framework 2. The increasingly declining fundamentals of the US economy urgently require a shift in monetary policy 3. The American stock market Big7, whose AI foam was completely bombed by China's scientific and technological innovation, also cried for help from the Federal Reserve to end the high interest rate environment. What specific time for adjustment: Personally, I believe that based on the Federal Reserve's past monetary policy, it is unlikely to reach a consensus in March, so I guess it will have to be postponed until at least June, most likely September, to meet the "late summer" in their January meeting minutes. Unless the US economic fundamentals or US stocks weaken beyond expectations, the Fed will have to drag on like this to appear cautious and professional. So, based on the current situation, Q4 is worth looking forward to. Policies may bring a huge amount of liquidity to the cryptocurrency industry, which may also be our opportunity and time point to escape the peak.