Matthew Pallai, Chief Investment Officer at Nomura Capital Management, stated that the U.S. Treasury market's reaction to Federal Reserve Chairman Jerome Powell's speech "feels like an overreaction."

He noted: "There remains considerable uncertainty at present, and as Powell mentioned, the interest rate path does not necessarily follow a predetermined trajectory."

Pallai indicated that risk markets have priced in expectations for a significant easing cycle, which does not align with the current level of uncertainty. He believes Powell's tone was "generally balanced overall," though Powell clearly did not rule out the possibility of a September rate cut.

Nomura Capital Management continues to expect the Federal Reserve to cut rates 1 to 2 times this year, depending on economic data performance.