Institutions: Market Pricing Federal Reserve No rate cut in January; rate cuts may begin as early as June
Svmuu News: According to a research report by Founder Securities, the December nonfarm payroll data was mixed. While the U.S. job market is generally on a moderate downward trend, the marginal improvement in the unemployment rate provides more reason to adopt a wait-and-see approach regarding January Federal Reserve. Combined with the possibility that the Supreme Court may rule the IEEPA tariffs unconstitutional,this could be bullish for U.S. stocks and the dollar in the short term but bearish for U.S. Treasuries: Data on new jobs, the job openings rate, and hourly wage growth indicate that the U.S. job market remained relatively weak in December, though the marginal decline in the unemployment rate was one of the few bright spots.Judging by the trends in interest rate futures and U.S. Treasuries, the market is pricing in Federal Reserve no rate cut in January following the data release, with rate cuts potentially beginning as early as June. Meanwhile, the Supreme Court’s potential ruling that IEEPA tariffs are unconstitutional implies marginally improved economic expectations, easing inflationary pressures, but worsening fiscal deficits.Given the combination of Federal Reserve the Fed’s reluctance to cut rates and the easing of tariff tensions, short-term U.S. Treasuries face numerous headwinds and are likely to trade at elevated levels. U.S. stocks, however, stand to benefit from the AI boom and reduced tariff disruptions, with sectors previously hit by tariffs—such as consumer staples and industrials—showing particularly strong resilience. (Jinshi)
Source:Odaily · Source Link
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