Recently, the speech by Finance Minister Bessent has attracted widespread follow, and the content involved is quite profound.

First of all, Besant's remarks have clearly exceeded the traditional scope of the Minister of Finance's functions. He not only provided explicit guidance on the future policy direction of the Federal Reserve but also predicted possible interest rate cuts, which is in stark contrast to his usual cautious comments on Federal Reserve policy.

Secondly, the 150 basis points rate cut proposed by Bessent far exceeds market expectations. Currently, the two-year U.S. Treasury yield remains around 3.68%, and the market generally believes that rates will not drop to about 3% until the end of next year. However, Bessent's prediction suggests that the terminal rate could fall to 2.75%, a view that is clearly more aggressive than what the market expects.

Besant also elaborated on the logic of the US interest rate cuts and Japan's interest rate hikes. He believes that high interest rates are suppressing economic growth, credit markets, the real estate industry, and the development of small and medium-sized banks in the US. Meanwhile, Japan is shifting from imported inflation to endogenous inflation, and the Bank of Japan may adopt a proactive and gradual interest rate hike strategy to smooth the interest rate curve and reduce market shocks.

It is also noteworthy that the move by Bessen seems to be an attempt to strengthen the influence of the financial sector on the market. In the current complex economic environment, a single interest rate signal has become difficult to dominate market pricing. With the arrival of a new round of fiscal expansion, the financial sector appears to be seeking greater discourse power.

Bessenet's remarks may, on one hand, be an open pressure on the current monetary policy, and on the other hand, could become a new type of 'parallel forward guidance'. Although this guidance does not rely on the Federal Reserve's dot plot, it may have an equal or even greater impact on the actual trading behavior of the market.

Overall, Besant's speech not only reflected the finance department's attitude toward monetary policy but also hinted at subtle changes that may be occurring in U.S. economic policy. Market participants need to closely follow this trend to timely adjust their investment strategies.