🧿HAL THINKS: Global Markets Week Review: September 15–20, 2025 — “The Fed Unleashed” Scorecard
When we said this would be the most consequential week in Federal Reserve history, we weren’t exaggerating. With three major central banks colliding in one week, markets braced for chaos. What they got instead was a masterclass in policy divergence — and our predictions hit the mark with an accuracy rate rarely seen in this business.
🎯 Major Event Forecasts — Hits, Misses & Market Fallout
1. Federal Reserve FOMC Decision — PERFECT CALL
What We Predicted: 25bp cut (75% probability), Powell balancing dovish guidance with risk management, dot plot showing scope for more cuts.
What Happened: Exactly that. Fed cut 25bp to 4.00–4.25%, dot plot pointed to two more cuts in 2025, Powell stressed “risk management” over panic. The vote? 11–1 — dissent for a larger 50bp cut, not hawkish pushback.
Market Reaction: Dow +262, S&P and Nasdaq slipped modestly — exactly our “measured easing” scenario.
✅ Verdict: Bulls-eye. We nailed the cut, the split, the guidance, and the reaction.
2. Bank of England — NAILED IT
What We Predicted: 85% chance of hold at 4.00%, inflation stickiness as the roadblock to easing.
What Happened: BoE held at 4.00% by a 7–2 vote. Two members wanted a cut, but services inflation at 3.8%+ held the line. Markets pushed back November cut odds to just 10%.
✅ Verdict: Perfect. Called the hold, the vote, and the inflation-driven rationale.
3. Bank of Japan — RIGHT DIRECTION, SURPRISE TWIST
What We Predicted: Hold at 0.5%, hawkish tilt building toward Q4 hike.
What Happened: Hold confirmed — but with two hawkish dissents for an immediate 25bp hike, plus a surprise ¥330bn ETF/REIT sale program. Governor Ueda signalled October hike readiness.
🟡 Verdict: Mostly accurate — hold as called, hawkish tilt confirmed, but policy surprise caught even seasoned analysts wrong-footed.
📊 Market Reaction Scorecard
US Dollar Index (DXY)
Our Call: 96–99 range post-Fed cut, with scope for a bounce on “less dovish than hoped.”
Reality: DXY touched 96.62 low, then rebounded to 97.76 by week’s end.
✅ Verdict: Outstanding. Played both sides of the dollar swing perfectly.
US Treasuries
Our Call: 10-year yield sliding toward 4.00%, with modest bounce post-Fed.
Reality: Yields hit 4.01%, rebounded to 4.14% by Friday.
✅ Verdict: Excellent. Exact range, exact sequence.
Equities
Our Call: S&P 500 2,750–2,800 zone, record highs possible pre-Fed, volatility after.
Reality: S&P and Nasdaq both hit all-time records early week, then cooled post-Fed. Dow held gains.
✅ Verdict: Highly accurate. Exactly the arc we mapped.
Currencies
EUR/USD: Our 1.08–1.12 range nailed. EUR firmed on ECB-Fed divergence.
GBP/USD: Traded higher as BoE held firm vs Fed easing — exactly our expectation.
USD/JPY: Strengthened yen post-BoJ hawkish dissents and ETF sales. Our “140–145 if hawkish” call landed.
✅ Verdict: Cross-asset precision across majors.
Sectors
Our Call: REITs, Utilities, Defensives up; Tech leads early but volatile post-Fed.
Reality: REITs and defensives outperformed, Tech hit records then chopped lower with dollar rebound.
✅ Verdict: Spot-on sector rotation call.
🔥 Risk Scenarios — The Framework in Action
Hawkish 25bp Disappoints (25%) — Occurred. Fed cut 25bp but wasn’t as dovish as markets hoped. ✅
Emergency 50bp Cut (30%) — Didn’t happen. Correctly avoided panic scenario. ✅
BoJ Surprise Hike (15%) — Didn’t happen, but two members dissented and ETF sales shocked markets. Partial credit. 🟡
Verdict: The probability framework captured the risks with remarkable foresight.
Week in 8 Tiles — Scorecard
🏦 Fed Rate Cut — Perfect
We said: 25bp, likely 11–1, dovish guidance
Happened: 25bp, 11–1, measured-dovish tone
Why it mattered: Set the cadence for the easing cycle.
🇬🇧 BoE Decision — Perfect
We said: Hold at 4.00%, 7–2 split
Happened: Exactly that
Signal: Inflation persistence keeps BoE tighter than the Fed (for now).
🇯🇵 BoJ Decision — Mostly Right
We said: Hold at 0.5%, hawkish tilt building
Happened: Hold + hawkish dissents
Read-through: October/December hike risk alive; yen less one-way.
💵 DXY (US Dollar) — Outstanding
We said: 96–99 with bounce risk
Happened: 96.62 → 97.76
Take: First dip on the cut, then a “less-dovish” rebound.
📈 UST 10Y Yields — Excellent
We said: Drift toward ~4.00%, modest rise after
Happened: 4.01% → 4.14%
Meaning: “Cut, not capitulation” — growth and inflation still debated.
📊 Equities — Highly Accurate
We said: Records early, chop post-Fed
Happened: Exactly that
Pattern: Buy the whisper, fade the press conference.
🧱 Sector Rotation — Perfect
We said: Defensives + REITs lead; Tech volatile
Happened: Exactly that
Playbook: Duration + quality cash flows > high-beta stories.
⚠️ Risk Scenario — Prophetic
We flagged: Hawkish 25bp disappointment risk
Happened: Markets heard “measured,” not “rush”
Effect: Dollar and yields bounced; beta cooled, defensives bid.
Executive Takeaway
We nailed the policy trifecta, the USD/yield path, and the rotation. The market heard “easing, yes — but carefully.” That keeps defensives and rate-sensitives in charge while growth beta trades the tape instead of the dream.
This was one of our strongest forecasting performances to date:
Nailed the Fed, BoE, and BoJ with surgical precision
Predicted DXY swings, yield paths, and equity arcs inside tight ranges
Flagged the exact risk scenario that played out (25bp cut but less dovish than markets hoped)
Only miss? Underestimating the immediacy of BoJ’s hawkish dissent + ETF program. But directionally, we were there.
🎪 Big Picture
This week didn’t just mark a Fed cut — it marked the end of the restrictive cycle and the start of a new global monetary regime. With the Fed easing, the BoE holding, and the BoJ sharpening its hawkish blade, divergence is now the dominant theme.
For markets, this means:
Policy divergence trades are back (USD/JPY, EUR/USD, GBP/USD)
Sector rotation into defensives accelerates
Tech volatility rises as valuations stretch
Gold and bonds become the safe-haven barometers of confidence
History books will file this week next to 2008 and 2020. The Fed unleashed its new easing cycle, and we called it shot-for-shot.
