news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

this week, global financial markets will face a "big test" with the federal reserve's interest rate decision.

the federal reserve will announce its september interest rate decision early thursday morning beijing time. the market generally expects it to start a rate cut cycle, but there is still disagreement on whether to cut by 25 basis points or 50 basis points at one time. according to data released by cme's "fed watch" on the morning of september 16 beijing time, the probability of the federal reserve cutting interest rates by 25 basis points in september is 48%, and the probability of cutting interest rates by 50 basis points is 52%.

recently, boosted by the federal reserve's upcoming rate cut and other factors, gold prices have continued to be active. bank of america strategist michael hartnett is bullish on gold to $3,000 per ounce.

in addition, the stickiness of us inflation has caused the market to worry about the risk of second round of inflation in the united states.

the federal reserve’s interest rate decision is about to be announced

the federal reserve will announce its september interest rate decision in the early hours of thursday morning beijing time. as the first rate cut in the interest rate cut cycle, whether the rate will be 25 basis points or 50 basis points, the answer will be revealed soon.

traders' latest forecasts show that the probability of the fed cutting interest rates by 25 basis points and 50 basis points this week is about the same. according to data updated on the morning of september 16th, beijing time, the probability of the fed cutting interest rates by 25 basis points in september is 48%, and the probability of cutting interest rates by 50 basis points is 52%. the probability of the fed cutting interest rates by 50 basis points by november is 30.2%, the probability of cutting interest rates by 75 basis points is 50.5%, and the probability of cutting interest rates by 100 basis points is 19.3%.

cui rong, chief analyst of overseas research at citic securities, said that in the context of slowing inflation but with flaws and cooling employment but with resilience in the united states, the federal reserve is still in a "risk management" rather than "crisis response" decision-making framework. while protecting the labor market, it also needs to take into account the still sticky price environment and minimize the risk of inflation returning. she believes that, in general,the federal reserve has the conditions to cut interest rates, but there is no need to do so quickly. it is expected to cut interest rates three times this year, each by 25 basis points.

"for the federal reserve, a 25 basis point rate cut in september and a 50-75 basis point rate cut for the whole year is a relatively neutral judgment." yan xiang, chief economist of huafu securities, said that the downside risks of the us economy are still relatively controllable. if interest rates are cut excessively, it will easily trigger the risk of secondary inflation.

regarding the allocation of major asset classes, yan xiang said that in the context of having already taken into account relatively full expectations of interest rate cuts, u.s. treasury bond interest rates may fluctuate in the short term, u.s. stocks are in the stage of digesting relatively high valuations in the short term, and medium- to long-term interest rate cuts are still beneficial to u.s. stocks; the u.s. dollar may benefit from the resilience of the u.s. economy and has limited downside space.

risk of second wave of inflation in the us remains

data released by the u.s. department of labor last week showed that the u.s. cpi rose 2.5% year-on-year in august, showing signs of continued slowdown in u.s. inflation, but still higher than the 2% long-term inflation target set by the federal reserve. it is worth noting that the u.s. core cpi in august increased month-on-month; it rose 3.2% year-on-year, exceeding expectations. the stickiness of u.s. inflation has caused the market to worry about the risk of a second round of inflation in the united states.

tianfeng securities released a research report saying that compared with the previous two rounds of soft landing cycles, the us economy will welcome the start of this round of interest rate cuts with the highest momentum level before the rate cuts. and from a broader perspective, without a sharp economic slowdown as a "trigger condition", the recession concerns based on the rising unemployment rate lack support. this also proves thatthe federal reserve's interest rate cut may trigger reflation, which may not be that far away.

in addition, jpmorgan chase ceo jamie dimon recently said that the "worst outcome" for the u.s. economy in the future other than recession is stagflation, a state in which rising inflation and unemployment lead to slower economic growth.

although the us inflation rate has dropped to 2.5%, a report released by the federal reserve bank of new york on the 9th showed that consumers' views on the market are generally mixed. the survey showed that americans responded that they expect their spending figures to increase by 5%, but household income will only increase by 0.1 percentage points compared with last year.

dimon believes that the probability of stagflation in the us economy in the future is around 35%, which means that the possibility of an economic recession is greater.

institutions are bullish on gold to $3,000

recently, gold has become a hotly watched asset class in the world. according to wind data, as of 6:40 am beijing time on september 16, the main contract of comex gold futures was still at a high of $2,600 per ounce, while london spot gold was around $2,580 per ounce.

source: wind

michael hartnett, a strategist at bank of america, said in his latest research report that gold is "the best hedge against reacceleration of inflation in 2025." as in 2021 and 2022, gold provided an early warning signal for the explosive inflation in the past two years by becoming the best performing asset.the gold price is expected to rise to $3,000 per ounce.

michael hartnett has been bullish on us bonds this year. his predictions have proven to be accurate. since hartnett started to be bullish on us bonds, the 10-year us bond yield has fallen by 100 basis points, once reaching a new low this year.

wang jiechao, chief analyst of metal new materials at citic securities, said that the market has no dispute over the rate cut itself, but there are differences in the extent of the rate cut, that is, there are differences in the way the us economy will land. if a hard landing occurs, a more radical rate cut will be very helpful in promoting gold prices; if the rate is only cut by 25 basis points, there will be a retreat for further observation of the economy. gold is still a defensive asset to deal with economic data that is lower than expected during the next rate cut. therefore, in the first half of the rate cut, gold is an excellent tool to deal with uncertainty.

nearly 20% of crude oil in the u.s. gulf of mexico

and 28% of natural gas production was shut down

according to cctv news, on september 15 local time, the u.s. offshore energy regulator said that nearly one-fifth of crude oil and 28% of natural gas in federal waters of the u.s. gulf of mexico were shut down due to hurricane francine. the u.s. bureau of safety and environmental enforcement estimated based on producer reports that energy producers have stopped production of 338,690 barrels of oil and nearly 515 million cubic feet of natural gas per day in the u.s. gulf of mexico.

recently, "francine" swept across the major offshore oil and gas producing areas in the united states and landed in louisiana, the united states on the 11th as a category 2 hurricane. the hurricane also caused power outages in four southern states of the united states.