7月FOMC点评：不急于行动，但出现分歧

Report Summary Core Viewpoints - The Fed maintained the target range of the federal funds rate at 4.25 - 4.5% in the July FOMC meeting, in line with market expectations. There were internal disagreements, with two governors voting against and favoring an immediate rate cut, but Powell's hawkish remarks at the press conference reduced the rate - cut expectation. The Fed may wait for employment data to weaken before cutting rates [2]. - Before the FOMC meeting, US economic data was robust, driving up US Treasury yields and strengthening the US dollar. After the meeting, financial conditions tightened, and the US stock market turned down, showing some "mild stagflation" pressure [6]. - The probability of the first rate cut within the year occurring in the fourth quarter has increased, subject to inflation, employment data, and the Fed's decision - making mechanism. The Fed is likely to wait and see based on inflation and employment data [2][9]. FOMC Statement - The Fed kept the federal funds rate unchanged. Two governors, Bowman and Waller, voted against, increasing the easing expectation to some extent, but Powell's hawkish speech later reduced the rate - cut expectation [2]. - The Fed noted that economic activity slowed in the first half of the year, with high uncertainty, a low unemployment rate, and a robust jobs market [2]. Powell's Press Conference - Powell considered the current interest rate to be at a moderately restrictive level. Inflation is slightly above 2%, the labor market is robust, and the Fed has not decided on a September rate cut, waiting for more data [3]. - Powell emphasized the Fed's independence from political influence, stating that it makes decisions based on data [3]. Market Performance - Before the FOMC meeting, multiple economic data showed a robust US economy, with the 7 - month ADP employment increasing by 104,000 (higher than the expected 75,000), and the Q2 real GDP annualized year - on - year growth at 3% (higher than the expected 2.4% and the previous value of - 0.5%). However, consumer spending cooled, and there was "mild stagflation" pressure [6]. - After the meeting, the 2 - year US Treasury yield rose 7.79bp to 3.95%, the 10 - year yield rose 4.77bp to 4.37%, the US dollar index strengthened, and US stocks turned down [7]. Outlook for Policy Path - By the September FOMC meeting, economic data may not support a rate cut. The probability of the first rate cut within the year occurring in the fourth quarter has increased [9]. - From the inflation perspective, the Fed needs to see the peak of the inflation pulse caused by tariffs pass. The inflation effect of tariffs is slower than expected, and inflation is expected to rise rapidly in the third quarter [9]. - In terms of employment, the Fed is unlikely to cut rates before the unemployment rate approaches 4.5%. Currently, the labor market supply - demand balance is maintained, and the probability of the unemployment rate rising to 4.4% or higher before September is low [9]. - The Fed's decision - making mechanism shows that although two governors supported a rate cut in July, Powell led the majority to maintain a relatively tight stance and a data - driven model, and the Fed's independence is well - defended [10]. Asset Allocation Views - US Treasuries: Due to tariff impacts and Fed policy expectations, short - term risks of US Treasuries may rise slightly in the third quarter, while long - term bonds may be relatively stable. It is recommended to buy 10 - year US Treasuries at a yield of around 4.5% [11]. - US Stocks: After hitting record highs, the US stock market may face short - term volatility due to inflation, Fed's tight - stance, and tariff impacts on corporate earnings. It is advisable to hedge short - term risks by increasing volatility [11]. - US Dollar: With trade partners' concessions on tariffs, the "de - dollarization" concern has eased. The US dollar may stage a rebound in the third quarter, and attention should be paid to its impact on the foreign exchange market and domestic monetary policies [12].