09.12.202512:03 Forex Analysis & Reviews: Look at the Data and Make Decisions

"The Fed Chair's job is to follow the data, interpret it, and explain why they are doing what they are doing," Hassett said on Monday. "And so to say: I am going to do this over the next six months would be really irresponsible."

Hassett's statement came amid growing uncertainty about the trajectory of the U.S. economy. Inflation remains elevated, while the labor market is showing signs of cooling. This contradictory picture creates challenging conditions for forecasting the Fed's future actions. Uncertainty is further reinforced by shifts in the global environment: geopolitical tensions, supply-chain disruptions, and fluctuations in energy prices all affect the global — and therefore the U.S. — economy. Under such conditions, as Hassett noted, attempts to determine monetary-policy direction far in advance may be counterproductive.

Instead, Hassett believes the Fed should pay close attention to incoming economic data and adjust its policy according to changing conditions. This implies a flexible and pragmatic approach, where decisions are made based on current information rather than predetermined plans.

Hassett, one of the leading candidates to succeed Jerome Powell when the Fed Chair's term ends in May next year, was asked how many more rate cuts he considers justified in 2026. "I don't want to disappoint you with how rate cuts are counted, but I can say that you need to follow the data," he said.

Earlier this year, President Donald Trump repeatedly called on the Fed to cut rates below 2%, compared with the current target range of 3.75–4%. Powell and his colleagues are expected to cut the federal funds rate by 25 basis points as soon as tomorrow, but the further path remains uncertain.

Hassett also said in an interview that he believes Powell has been performing well in the role.

As for the current technical picture of EUR/USD, buyers now need to think about how to reclaim the 1.1650 level. Only this will allow a move toward testing 1.1680. From there, it is possible to climb to 1.1705, but doing so without support from major players will be quite challenging. The most distant target will be the 1.1725 high. In the event of a decline, I expect significant action from large buyers only around 1.1625. If no one shows up there, it would be better to wait for a renewal of the 1.1590 low or open long positions from 1.1570.

As for the current technical picture of GBP/USD, pound buyers need to reclaim the nearest resistance at 1.3350. Only this will allow a move toward 1.3380, above which breaking through will be rather difficult. The most distant target will be the 1.3415 level. If the pair falls, the bears will try to regain control over 1.3310. If they succeed, a breakout of the range will deal a serious blow to the bulls' positions and push GBP/USD down to the 1.3270 low, with prospects of reaching 1.3240.