Core Viewpoint - The article discusses the resilience and challenges of the global economy, particularly focusing on the U.S. economic outlook, fiscal policies, and market strategies for the second half of 2025, highlighting the interplay between fiscal expansion, interest rates, and inflation pressures [1][4]. Overseas Macro: Resilience and Concerns - The article notes that external demand for China may significantly decline, making internal demand crucial for economic stability, with a projected GDP growth of 5% for the year and a potential drop in the GDP deflator index to -1% [1]. - The U.S. economy is expected to show resilience despite concerns about recession, with fiscal policies remaining expansionary and the Federal Reserve's interest rate cuts being limited [5][7]. - The article emphasizes the ongoing challenges posed by tariffs and geopolitical tensions, which may hinder the inflation reduction process [5][8]. U.S. Policy: Fiscal Dominance - The U.S. fiscal policy is characterized by a cyclical expansion, with a low unemployment rate of 4.0-4.2% and a high deficit rate of 6-7%, which is about 3 percentage points above historical averages [7][9]. - The article highlights the negative impacts of high interest rates on private sector financing costs, potentially leading to economic inefficiencies and structural imbalances [8][14]. - The ongoing fiscal expansion is expected to exacerbate the U.S. deficit, with projections indicating a deficit of $1.36 trillion for the 2025 fiscal year, a 13% increase from the previous year [9][11]. Monetary Policy: Reactive Rather Than Proactive - The Federal Reserve's stance is described as reactive, with limited room for interest rate cuts due to persistent inflation and a stable labor market [15][21]. - The article indicates that inflation pressures are shifting from internal to external factors, with tariffs being a significant concern for future inflation [25][29]. - The Fed's cautious approach to rate cuts may lead to a divergence between consumer inflation expectations and financial market predictions [27][29]. U.S. Economic Performance: Behind the Prosperity - The U.S. economy has shown strong performance, with a projected GDP growth rebound to 4% in Q2 2025, driven by a recovery in consumer sentiment and reduced tariff uncertainties [30][33]. - The article notes that while private investment is expanding, it is heavily concentrated in technology sectors, with other sectors facing challenges due to high interest rates [37][41]. - Consumer spending is expected to remain stable, but the underlying financial pressures on households may limit further growth [47][56]. Japan: The Elephant in the Room - Japan's economy is transitioning from deflation to stagflation, with significant challenges to fiscal sustainability and potential risks to global financial markets [61][62]. - The article highlights that Japan's nominal indicators have improved, but actual economic recovery remains weak, with GDP growth at only 1.7% [65][66]. - The potential for rising interest rates in Japan could lead to significant market volatility, impacting global liquidity [75][79]. Overseas Strategy: Favoring Short to Medium-Term U.S. Bonds and Balanced U.S. Equity Allocation - The article suggests maintaining a balanced allocation in U.S. equities, with expectations for a gradual upward trend supported by corporate earnings growth [82][83]. - It recommends holding short to medium-term U.S. bonds while temporarily avoiding long-term bonds due to anticipated high interest rate volatility [88][93]. - The foreign exchange market is expected to see a continued weakening of the U.S. dollar, with non-U.S. currencies gaining strength amid ongoing uncertainties [94][95].

Group 1: Macroeconomic Outlook - The U.S. economy is expected to show resilience supported by fiscal expansion, but this may lead to higher inflation and interest rates, complicating the Federal Reserve's policy stance [1][2] - China's economy faces both challenges and opportunities due to evolving tariff dynamics, with a projected GDP growth of 5% for the year and a potential decline in the GDP deflator index to -1% [1][2] - The economic environment is characterized by strong supply but weak demand, leading to price pressures [1][2] Group 2: Fiscal and Monetary Policy - Fiscal policy is anticipated to shift from acceleration to strengthening, with an expected increase in fiscal tools by 500-1,000 billion yuan to support local finances [2][3] - Monetary policy will maintain a "moderately loose" stance, with potential interest rate cuts and reserve requirement ratio reductions to support economic growth [2][3] Group 3: Capital Market Dynamics - The domestic capital market is expected to see a gradual decline in bond yields, while A-shares may stabilize but lack upward momentum [3] - The international market is likely to continue the trend of de-dollarization, with U.S. equities expected to experience volatility [3] Group 4: Economic Predictions - China's GDP growth is forecasted to remain at 5.0% for 2025, with nominal GDP growth projected at 4.0% [4] - Key economic indicators such as retail sales and fixed asset investment are expected to show varied growth rates, with retail sales projected to grow by 4.8% [4] Group 5: Asset Allocation Strategy - Recommendations for asset allocation suggest a focus on A-shares, particularly in consumer and cyclical sectors, while advising against exposure to U.S. equities [5] - Fixed income strategies favor Chinese government bonds, while U.S. dollar-denominated assets are recommended for low allocation [5] Group 6: U.S.-China Trade Relations - The U.S.-China tariff situation has seen a significant reduction, with current tariffs approximately 41% compared to pre-trade war levels [7][8] - Future negotiations may lead to further tariff reductions, but risks of tariff increases remain [12][14] Group 7: U.S. Macroeconomic Conditions - The U.S. economy is experiencing steady growth despite high inflation concerns, with GDP growth projected to be stable [17][18] - Fiscal policies are shifting towards expansion, with a potential fiscal deficit rate above 6% [30] Group 8: De-dollarization Trends - The trend of de-dollarization is gaining attention, with a notable decline in the dollar's share in global reserves from 73% to 58% since 2001 [90] - Factors contributing to this trend include increased competition from non-U.S. currencies and the impact of U.S. financial sanctions [90]

Economic Overview - The internal momentum of the US economy is weakening, with the Atlanta Fed's GDPNOW model predicting a 0.4 percentage point decline in Q2 real GDP growth to 3.4% [2] - Personal consumption expenditure (PCE) growth has decreased by 0.6 percentage points to 1.9%, primarily due to a slowdown in the services sector [2] - Private investment growth (excluding inventory) has dropped by 0.8 percentage points to 0.4%, with significant contractions in real estate (-4.4%) and construction (-3.4%) [2] - The job market remains stable, with weekly initial jobless claims falling by 0.3 thousand to 245 thousand, aligning with seasonal levels [2] - The worsening situation in the Middle East is increasing inflationary pressures, as indicated by the Truflation daily inflation index rising by 8 basis points to 2.14% [2] Fiscal and Monetary Policy - Fiscal policy remains expansionary, with a weekly fiscal surplus of $18.5 billion, which is weaker than seasonal levels but stronger than historical averages [3] - The Federal Reserve maintained a wait-and-see stance during the June meeting, with the dot plot indicating that 7 out of 18 members do not expect rate cuts this year [3] Market Performance - Overseas markets showed muted performance last week, with the US dollar slightly rebounding and US Treasury yields fluctuating [4] - The US stock market was nearly flat, up 0.1%, with expectations that the most significant tariff impacts have passed, potentially leading to a renewed upward trend driven by corporate earnings resilience [4] - However, high valuations and increased tariffs may limit upward potential [4] - The strategy suggests maintaining a neutral position on US stocks with a balanced allocation [4] Chinese Economic Conditions - Domestic demand shows mixed signals, with strong automotive consumption but a slowdown in real estate transactions [6] - In June, average daily retail sales of passenger cars reached 48,000 units, a 17% year-on-year increase [7] - Real estate sales are declining, with new home transaction volumes in 30 major cities dropping by 8.6% year-on-year [7] - The land market is also cooling, with land supply and transaction volumes decreasing [7] External Demand and Trade - High-frequency data indicates a potential slowdown in China's export growth in June, with port cargo and container throughput growth rates declining [8] - Exports to the US may have seen some recovery, while exports to non-US regions are expected to decline from previous highs [8] Fiscal Performance - In May, fiscal revenue growth slowed, with public budget revenue increasing by only 0.1% year-on-year [9] - Tax revenue growth decreased to 0.6%, while non-tax revenue turned negative for the first time in 2024 [9] - Government spending growth was also slower, with a 2.6% increase year-on-year [9] Market Strategy - The bond market is showing strength, with short-term rates performing well due to a stable funding environment [10] - The A-share market experienced a slight decline, with uncertainties in corporate earnings and the need for further policy support for real estate and consumption [12] - The Hong Kong stock market is facing risks of correction, with high valuations and unstable fundamentals [12]

Core Viewpoint - The bond market has shown a strong performance recently, with various fixed-income products experiencing growth in returns, particularly those with embedded options [2][3][11]. Summary by Sections Fixed Income Product Performance - In the past month, the bond market experienced fluctuations, with rates generally declining. Various stable products saw an increase in net value, especially option-embedded fixed income products, followed by medium- and long-term bond funds [3][9]. - As of June 18, the monthly returns for different products were as follows: option-embedded bond funds at 0.54% (previously 0.62%), medium-term bond funds at 0.31% (previously 0.13%), short-term bond funds at 0.18% (previously 0.19%), high-grade interbank certificates of deposit index funds at 0.15% (previously 0.18%), and cash management products at 0.11% (unchanged) [3][10]. Bond Market Review - The bond market showed a pattern of weakness followed by strength, influenced by market sentiment and liquidity conditions. The tightening of liquidity in late May, combined with the U.S.-China trade meeting in early June, initially suppressed bond market performance. However, after the month transitioned, the central bank's supportive stance on liquidity led to a recovery [11][12]. - The one-year AAA interbank certificate of deposit rate fell to approximately 1.65%, a slight decrease from the previous month, indicating a shift towards a more favorable liquidity environment [12][15]. Market Outlook - In the short term, the bond market is expected to maintain a low-interest, low-volatility trend, with the 10-year government bond yield projected to fluctuate between 1.5% and 1.8%, centered around 1.7% [31][34]. - Credit bonds are anticipated to outperform interest rate bonds, with credit spreads likely to remain relatively low, minimizing the risk of significant widening [34]. Asset Management Industry Trends - The scale of wealth management products increased to 31.3 trillion yuan by the end of May, reflecting a 1.6% month-on-month growth. This growth is attributed to the decline in bank deposit rates, which has made wealth management products more attractive [36]. - On May 23, the National Financial Regulatory Administration released a draft for asset management product information disclosure, allowing for more flexible performance benchmark disclosures, which may influence investor behavior in the long term [36]. Investment Strategy Recommendations - For investors needing liquidity management, maintaining cash-like products and considering stable low-volatility wealth management or short-term bond funds is advisable [39]. - For conservative investors, holding pure bond products with a potential extension of duration is recommended, especially as the 10-year government bond yield approaches 1.7%-1.8% [40]. - For more advanced conservative investors, continuing to hold fixed-income plus products is suggested, with a focus on incorporating convertible bonds and equity assets into the strategy [41].

Economic Overview - The economic outlook has slightly deteriorated, with growth rate forecasts down by 0.3 percentage points and unemployment rate up by 0.1 percentage points compared to March predictions [2] - The PCE and core PCE inflation forecasts have been raised by 0.3 percentage points, with tariffs expected to push prices higher this year [2] Policy Insights - The dot plot indicates a "bimodal distribution" within the Federal Reserve, with one faction focused on the impact of tariffs on prices and another concerned about the economic growth implications [4] - Seven officials predict no rate cuts in 2025, while two expect only one cut this year, and eight anticipate two cuts [4] - Powell emphasized the uncertainty in the economic outlook and stated that no official can make a clear prediction on interest rate movements under current conditions [3][4] Market Strategy - The market reacted moderately to the Fed's meeting, with a neutral trading return at the close [5] - The OIS curve suggests a 48 basis point reduction in rates by 2025, approximately two cuts [5] - U.S. Treasury yields showed minimal changes, with the 2-year yield at 3.94%, 5-year at 3.99%, 10-year at 4.39%, and 30-year at 4.89% [5] - The dollar index increased by 0.06% to 98.878, with the offshore RMB exchange rate stabilizing around 7.19 [6] - The S&P 500, Nasdaq, and Dow Jones indices showed little movement, indicating a cautious market sentiment [7] - The 10-year yield above 4.5% and 5-year yield above 4.1% are seen as suitable entry points, with potential for a technical rebound in the dollar providing selling opportunities [7]

■ 尽管近期中美关税显著缓和，但相较2018年贸易战1.0时期，本轮美国对华加征关税范围广、节奏快、幅度 高、政策不确定性大，预计仍将对我国出口和经济增长形成一定拖累。 ■ 更加积极的财政政策或更加突出功能财政理念，作为经济中的"最后借款人"积极提振需求。一方面，财政将 加快已有政策执行落地节奏。结合预算内和预算外资金测算，今年财政总量空间明显扩张。另一方面，年内财 政仍有"空中加油"的必要性。一是对冲关税冲击，托底经济增长。二是支持地方政府，推动地方财政重回扩 张。 ■ 2025年预算内财政总量空间 达41.6万亿，较上年显著扩张2.5万亿，为历史最高水平。一是目标赤字率突破 至4.0%。二是预算收入目标保守务实。三是收入承压背景下，财政预算支出较为积极。四是政府债券是财政 增量财力最主要的来源，超长期特别国债常态化发行。 ■ 2025年预算外财政空间或进一步打开，规模或达7.8万亿，较上年增加1.3万亿；占名义GDP的比重为5.5%， 较上年提高0.7pct。财政预算外资金来源主要是政策性银行以及城投平台。其中，政策性银行对财政的支持主 要体现在政金债和PSL两方面。 ■ 目前地方政府财政压力和债务负担依 ...

Core Viewpoint - China is leveraging its advantages in the drone industry to establish a leading position in the low-altitude economy, focusing on the commercialization of application scenarios, particularly in logistics and transportation [1][2]. Group 1: Low-altitude Economy Development - The low-altitude economy is advancing towards electrification, intelligence, and connectivity, aiming to bypass Western technological barriers and establish standards and regulations [5][10]. - The current scale of China's low-altitude economy has exceeded 500 billion yuan, with a growth rate of 33.8%, and is expected to surpass one trillion yuan in the next three years [2][12]. - The commercialization of low-altitude economic application scenarios is progressing in phases, with consumer markets maturing and sectors like agricultural protection and industrial inspection entering commercial operations [1][12]. Group 2: Low-altitude Logistics Market - The low-altitude logistics market is projected to grow rapidly, reaching approximately 330.5 billion yuan in 2024 and potentially becoming a trillion-yuan market within five years [2][18]. - The penetration of drones in the last-mile delivery market has completed the "0 to 1" process, with expectations for large drones in trunk and branch logistics to follow [2][17]. - The demand for drones from logistics companies like SF Express and Meituan is expected to drive investment in the drone manufacturing and component sectors, reshaping the competitive landscape [2][46]. Group 3: Commercialization Pathways - The commercialization of low-altitude logistics will occur in two phases: expanding city and route coverage, followed by increasing flight density [25][37]. - The average delivery time for drone logistics is significantly reduced compared to traditional methods, with potential cost savings as drone usage scales up [27][31]. - The integration of drones into logistics is expected to enhance efficiency and reduce costs, making low-altitude logistics one of the most promising application scenarios [26][36]. Group 4: Industry Collaboration and Future Outlook - Major logistics companies are collaborating with startups to lead the development of the drone logistics industry, with significant procurement orders expected to reshape the competitive landscape [46][47]. - The future investment in the low-altitude logistics sector is anticipated to exceed 500 billion yuan, driven by the demand for drone procurement and operational infrastructure [43][44]. - The rapid growth of the express delivery and instant delivery markets presents substantial opportunities for drone logistics, with significant room for penetration in both sectors [38][39].

美国经济保持稳步扩张态势，美联储年内降息预期维持在2次（约50bp），降息终点预期维持在3.5%。 亚特兰大联储GDPNOW模型预测二季度美国实际GDP年化增速稳定在3.8%，投资扩张继续减速，长端利率上 行的紧缩效应再度显现。个人消费（PCE）增速稳定在2.5%，商品（3.0%）与服务（2.2%）同步扩张；私人 投资（不含库存）增速降至1.1%，主要来自地产（-1.6%）及建筑（-3.3%）分项的拖累。 失业率趋势企稳。周频首次申领失业金人数稳定在24.8万，结束了一轮上行趋势，符合季节性水平。通胀再起 波澜，中东局势恶化推升油价，Truflation日频通胀指数上行22bp至2.06%。 海外策略：美元延续弱势行情 财政保持扩张立场。周频财政赤字额达到$407亿，继续超出季节性水平。2025财年美国赤字水平将继续处于高 位。 基于"双目标"及经济、财政形势推演，美联储并无大幅调整政策的动机，维持年内降息不超2次（50bp）判 断，甚至可能不降息。 上周影响海外市场走势的逻辑有两条：一是美国通胀数据低于预期，市场交易偏鸽。二是伊以冲突升级，避险 情绪升温。在此背景下，美债、黄金表现较好，美元跌至年内最低，人 ...

Core Viewpoint - The economic data for May indicates a mixed performance, with supply-side growth remaining strong while demand-side indicators show signs of slowing down, particularly in investment and real estate sectors [1][5]. Supply Side: Strong Support - In May, the industrial added value for large-scale enterprises grew by 5.8% year-on-year, slightly above the market expectation of 5.7% [6]. - The manufacturing sector saw a marginal slowdown, with high-tech industries maintaining robust growth rates of 8.6% [6]. - The service sector production index increased by 6.2%, driven by recovering consumer demand and increased holiday travel [9]. Fixed Asset Investment: Real Estate Drag - Fixed asset investment grew by 3.7% year-on-year, below the expected 4.1%, with infrastructure and manufacturing growth rates declining [10]. - Real estate investment saw a significant decline of 10.7%, indicating ongoing challenges in the property market [10][14]. - The construction sector is under pressure due to local government debt and slow issuance of special bonds for projects [10][11]. Consumption: Accelerating Beyond Expectations - Social retail sales increased by 6.4%, significantly higher than the market expectation of 4.8%, with both goods and catering consumption reaching new highs for the year [19]. - The increase in consumption is attributed to policy effects, pre-scheduled shopping festivals, and high demand for electronics and home appliances [19][22]. Outlook: Stabilizing with Localized Pressure - The impact of tariff changes on the economy is expected to weaken, with the second quarter growth likely to exceed earlier market expectations [24]. - However, persistent low prices may continue to erode corporate profits and delay improvements in consumer expectations [24].

Group 1 - The article discusses the increasing uncertainty in global economic policies and the challenges investors face in wealth growth, particularly in the context of low interest rates in China and high volatility in equity assets [1][4] - It introduces two classic asset allocation models: the Permanent Portfolio and the All Weather Portfolio, which aim to create low-volatility investment strategies that can withstand economic cycles [1][4] - Historical data from 1971 to 2024 shows that both models have achieved annualized returns of 8-9% in the US market, with the Permanent Portfolio yielding 8.4% and the All Weather Portfolio yielding 8.7% [10][11] Group 2 - The long-term effectiveness of these models is attributed to three main reasons: economic growth and monetary expansion leading to positive returns on underlying assets, low correlation among assets reducing portfolio volatility, and diversification and rebalancing enhancing compound returns [2][19] - The article emphasizes that the long-term returns of various asset classes are generally positive, with equities outperforming other assets, which is crucial for the portfolio's ability to exceed nominal GDP growth [2][20][22] Group 3 - The article details the asset allocation ratios for both models, explaining that there is no optimal allocation ratio as it depends on individual risk preferences and return objectives [3][55] - It highlights the importance of understanding the long-term returns and volatility of underlying assets, as well as their correlations, to make informed allocation decisions [56][57] Group 4 - The article analyzes the performance of the Permanent and All Weather Portfolios in the US market, showing that both portfolios have lower volatility compared to individual asset classes while achieving returns close to equities [14][18] - It provides a detailed examination of the historical performance of these portfolios, including their maximum drawdowns and annual returns over the years [10][11][12]