Core Viewpoint - The Federal Reserve's decision to cut interest rates by 25 basis points, rather than the anticipated 50 basis points, is expected to support a rebound in the US dollar while putting pressure on Asian currencies in the short term. Additionally, the recent surge in technology stocks may face profit-taking and a "buy the rumor, sell the news" trend [1][2]. Summary by Sections Federal Reserve Decision - The Federal Reserve's first rate cut in nine months aligns with market expectations, with the median forecast in the FOMC dot plot indicating three rate cuts this year and one more next year [1][2]. - The dot plot reveals a division among Fed officials, with 7 expecting no further cuts this year and 2 supporting only one more cut, suggesting a potential stalemate on future rate decisions [2]. Market Reactions - Analysts from Wells Fargo and Sumitomo Mitsui Trust Bank noted that the strong dollar is likely to affect Asian currencies, with high-beta currencies such as the South Korean won and Indonesian rupiah being particularly sensitive [3]. - Following the Fed's announcement, the dollar initially faced selling pressure but rebounded as traders adjusted their positions based on the expectation of only one more rate cut next year [3]. Economic Outlook - Despite the potential for the dollar to rise to 147 yen, there remains a strong bearish sentiment towards the dollar, which may limit its upward potential [4]. - Analysts from TD Securities and VanEck expressed a bearish outlook on the dollar, viewing any technical rebounds as opportunities to short, while highlighting that economic growth outside the US appears stronger [5]. Future Considerations - The overall market response to the Fed's decision is expected to be muted, with potential for a pullback in the coming days as investors seek new catalysts for market highs [4]. - The upcoming US-China trade negotiations are anticipated to be a significant focus for market participants, potentially influencing market dynamics [5].