The Fed's decision to stay in place and release the dove signal is in the best interest of the stock market

On 29 July, the Morgan Chase Market Intelligence team indicated that the Fed would be the “best outcome” of the stock market by maintaining interest rates and releasing pigeon signals. The team ' s scenario analysis showed that the Fed maintained interest rates at the same time as it had a 28 per cent probability of releasing a loose signal to inflation prospects. In such cases, the 500 index could increase by 0.5 to 1 per cent. The team led by Andrew Tyler wrote in the report that the worst result was a 50 basis point increase in the Fed, but that the probability of such a scenario was only 1 per cent. In this case, the 500 index could drop by 2 to 4 per cent. The team ' s baseline scenario is the Fed ' s position hawk and maintains interest rates at a 50 per cent probability. In this scenario, the Fed warns of the need to remain vigilant about inflation. Swap traders expect a 30 per cent probability of a 25 basis point increase in the Federal Reserve ' s resolution issued later on Wednesday. The Morgan Chase team stated that even if the Fed reduced interest rates, the stock market could fall if the market considered that it lost its independence。