Live Webinar This Thu: FOMC First Cut!

Author

Pete Tan
September 17, 2025

FOMC week is here and there’s a lot on the line. Rates could move. Messaging will matter. Here’s a deep dive on what I’m watching and what I think you need to be ready for.

This is so funny

What’s Going On

  • The Fed meets Sept 16‑17 and most expect a 25 basis point cut to the federal funds rate, bringing it to 4.00‑4.25% this week. There’s a small chance of a bigger cut but that seems unlikely.

  • Labor market showing cracks: non‑farm payrolls badly missed estimates in August, unemployment is creeping up. That softening gives the Fed cover to ease.

  • Inflation remains above target, especially core inflation. Fed will be very careful about letting inflation expectations drift higher. They want confidence inflation is really headed toward 2‑3% before getting too dovish.

3 Key Things Investors Must Watch

Here are the three levers that could determine how good/bad opportunities are in the coming months

  1. Powell’s Press Conference + Dot‑Plot
    What the FOMC members say matters just as much as what they do. The dot plot (projections for rates) could show how many cuts are expected, when, and how aggressively. If Powell emphasizes inflation risk or is more cautious, markets might react poorly even if there is a cut.

  2. Labour Market Signals
    Hiring, unemployment, wage growth. If labour stays “soft but not collapsing” that gives the Fed wiggle room. If jobs growth picks up unexpectedly, inflation pressures return. Big risk of surprise in either direction.

  3. Market Reaction Risk: Sell‑the‑News
    Everyone seems synched to expect a rate cut. But markets often disappoint on the “after cut” moves especially if the cut is only 25bps and Fed signals a slow path ahead. Stocks are richly priced. Bond yields, especially short and medium terms, will be telling. If panic sets in, volatile moves possible.

What I’m Leaning On

Here’s how I’m thinking about positioning ahead of & after this Fed meeting:

  • Favor sectors that usually benefit in a falling rate regime: growth / technology, real estate, possibly consumer discretionary.

  • Be cautious with rate‑sensitive assets where rising inflation or sticky inflation surprises would hurt (e.g. long duration bonds unless yield premium is enough).

  • Keep some hedge with cash, gold or short duration fixed income because unexpected hawkishness or inflation surprises are still real risks.

Why It Matters for You

Because this meeting will affect more than just rates:

  • If mortgage rates respond, property investors need to know if now is a buying moment or one to hold off

  • For stock investors, valuations are already high and the margin of error is slim

  • How you position now (asset mix, exposure, risk) could define your returns over the next 12‑24 months

👀 Coming Up With Me Live

I’ll be going over all of this and more in the Invest with Pete Public Webinar on 18 Sep. We’ll talk interest rate moves, how this will hit mortgages, stock & property investing, and how to build a portfolio that weathers whatever the Fed throws.

Also I will be sharing about my view on the stock market for next 6 months.

18 Sep Thurs, 9pm (SGT)

Happy Hunting!

Pete
Invest with Pete

🚨‼️ By the way, I’ll never PM anyone on telegram or any other social media platforms. If you receive any “Pete” messaging you, these are scammers impersonating me. Pls beware!

The information provided in this newsletter is for informational purposes only and does not constitute financial advice. Readers should seek their own independent financial advice before making any investment decisions. Please note that while Pete is a portfolio manager, the opinions expressed in this newsletter are his own and do not represent the views of any organization. Always perform your own research and due diligence before investing.

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