Sou Hu Cai Jing·2025-05-14 06:03Economic Outlook - Recent economic dynamics in the US, including milder inflation data and easing US-China trade tensions, are alleviating concerns about severe impacts on households and businesses [1][3] - Major financial institutions like JPMorgan and Barclays have adjusted their economic forecasts following a recent US-China trade agreement, which includes a reduction in punitive tariffs [3] Inflation Data - The US Consumer Price Index (CPI) rose by 2.3% year-on-year in April, marking the smallest increase in over four years, which supports market expectations for gradual interest rate cuts by the Federal Reserve [4][5] - Core CPI, excluding volatile food and energy prices, increased by 2.8%, with prices of goods like clothing and vehicles remaining stable or declining, contrary to market expectations [6] Federal Reserve Policy - The Federal Reserve has maintained its short-term borrowing costs between 4.25% and 4.50%, with no immediate signs of economic collapse observed [5][6] - Market expectations for interest rate cuts have shifted, with traders now anticipating only two rate cuts within the year, potentially starting in September rather than July [3][6] Trade Policy Impact - The recent US-China trade agreement has significantly influenced market confidence, leading to a reassessment of recession risks and economic forecasts [3] - Despite the easing of some tariffs, the overall tariff levels remain historically high, and the final shape of trade policies is still uncertain, which complicates economic predictions [6]