Group 1 - The Federal Reserve announced a 25 basis point reduction in the federal funds rate target range from 4.25%-4.50% to 4.0%-4.25% [1][2] - The Fed's statement highlighted a slowdown in economic activity growth and a slight increase in the unemployment rate, although it remains at historically low levels [1][2] - The Fed aims to achieve full employment and maintain a long-term inflation rate of 2%, while acknowledging high uncertainty in the current economic outlook [1][2] Group 2 - The decision to lower interest rates was influenced by increased downside risks in the labor market, which were a significant consideration for the policy adjustment [1][2] - The Fed will continue to monitor a wide range of economic indicators, including labor market conditions and inflation pressures, to guide future monetary policy adjustments [2] - The recent rate cut was passed with a vote of 8 in favor and 1 against, reflecting a consensus on the need to address potential growth risks despite ongoing inflation concerns [2]

Core Insights - Japan's manufacturing sector experienced a significant decline in recurring profits, down 11.5% year-on-year in Q2, influenced by U.S. tariff policies and other factors [1] - Overall sales in Japan's non-financial sectors saw a slight increase of 0.8% year-on-year, while recurring profits in non-manufacturing rose by 6.6% [1] - The transportation machinery sector, heavily reliant on the automotive industry, faced the most severe profit drop of 29.7% [1] Manufacturing Sector Analysis - In Q2, manufacturing sales increased by 1.3% year-on-year, but recurring profits fell by 11.5%, marking a consecutive decline over two quarters [1] - Out of 11 manufacturing industries, 7 reported a decrease in recurring profits, with declines exceeding 10% in sectors such as petroleum, steel, metal products, transportation machinery, chemical industry, commercial machinery, and general machinery [1] Investment Trends - Total equipment investment across all industries, including software investments, grew by 7.6% year-on-year [1] - A representative from the Ministry of Finance indicated that while the economy is showing signs of slow recovery, U.S. trade policies pose a downside risk, necessitating close monitoring of corporate trends [1]

Group 1 - Indonesia is the largest economy in ASEAN, with a GDP growth rate averaging 6.8% from 1968 to 1996. By 2024, Indonesia's GDP is projected to reach approximately $1.4 trillion, ranking 16th globally, with a per capita GDP nearing $5,000 [1] - Indonesia's manufacturing sector is primarily driven by domestic demand rather than reliance on foreign trade and investment. The manufacturing industry has a high share of food and beverage, exceeding 36%, and Indonesia is a leading producer and exporter of agricultural and mineral resources [1] - Despite its strengths, Indonesia's manufacturing sector is experiencing early signs of decline [1] Group 2 - The Indonesian government has implemented a series of policies to boost the manufacturing sector. There is a complementary relationship between China and Indonesia in terms of technology and resources, which may deepen cooperation amid global supply chain restructuring [2] - China is both the largest importer and exporter to Indonesia, and Indonesia is the second-largest investment destination for Chinese enterprises in ASEAN, particularly in manufacturing [2] - Chinese investments in Indonesia have formed four major manufacturing clusters [2]

Report Industry Investment Rating - No information provided in the report Core Viewpoints of the Report - The Jackson Hole Global Central Bank Annual Meeting will be a "watershed" for the Fed's policy direction. The market should focus on three key signals: labor market judgment, inflation risk statements, and emphasis on policy flexibility [2][36] - Powell's speech at the meeting is likely to maintain a "neutral to hawkish" stance, emphasizing "inflation resilience" and "policy flexibility" to guide the market to reduce bets on "consecutive rate cuts" [3] - The Fed's core goal of "balancing inflation and growth" remains unchanged. The game between the lagged impact of tariffs and economic downside risks will be the main line of future monetary policy [3] Summary by Directory Introduction: Policy Weathervane Significance of the Jackson Hole Annual Meeting - The Jackson Hole Annual Meeting is a key platform for the Fed to release major policy signals. The policy statements at this meeting often set the tone for subsequent monetary policies [4][7] Current Economic Background and Complexity of the Fed's Policy Environment Macro - economic and Policy Pressure Intertwined - The US economy shows multiple contradictory features. Inflation pressure is structurally differentiated, with core CPI showing more resilience. The labor market is cooling but still has some strength, and external policy pressure has increased significantly [8][11][13] - As of August 19, the market's probability of a 25 - basis - point rate cut in September has reached 90%, and some institutions have even raised the probability of a 50 - basis - point rate cut [13] Fed's Internal Disagreement - The dovish camp is concerned about economic downside risks and employment market slowdown, advocating for near - term rate cuts. The hawkish camp emphasizes labor market resilience and inflation rebound risks, advocating maintaining high interest rates [14] Key Economic Data Analysis July US CPI Data - July CPI showed "overall stability and strong core." Energy prices declined, food prices were stable, while core services inflation was strong. Different commodity items were affected differently by tariffs and demand [15] July US PPI Data - July PPI showed an unexpected increase, mainly driven by services. The increase in PPI may not fully reflect fundamental inflation pressure, but it indicates potential upward risks for future CPI [22][23] Root Causes of the July CPI and PPI Divergence - The divergence between CPI and PPI reflects the complexity of inflation transmission, including a 1 - 3 - month time lag in cost transfer and possible statistical differences [25] Possible Scenarios of Powell's Speech and Policy Signal Analysis - Scenario 1: Absence from the meeting. This is a "passive neutral" strategy to avoid market volatility and leave policy decisions to economic data before the September meeting [27] - Scenario 2: Deliver a "non - substantial" speech. This is to maintain policy options' openness and postpone the final decision to the September meeting [28] - Scenario 3: Moderately release rate - cut signals. This requires further deterioration of employment data and significant escalation of external pressure from the Trump administration [28] Market Expectations and Future Monetary Policy Outlook Short - term Market Expectations and Risks - Market expectations of the number of rate cuts this year are around 3 times, but this is at risk of adjustment. US economic downside risks are accumulating, making short - term policy expectations more complex [34] Medium - to - Long - term Monetary Policy Path - The lagged impact of tariffs will be a key constraint on the Fed's policy in the next 1 - 2 years. In Q4 2025, inflation pressure may intensify, and in 2026, inflation is likely to fall, opening up room for significant rate cuts [34] Conclusion: Core Observation Points of the Jackson Hole Annual Meeting - The meeting will be a "watershed" for the Fed's policy. The market should focus on labor market judgment, inflation risk statements, and policy flexibility [36]

Core Viewpoint - The Bank of Japan's meeting minutes indicate that many members expressed concerns about increasing downside risks to the economy and prices, emphasizing the need for careful examination of each country's trade policies and their developments [1] Group 1 - Many members of the Bank of Japan highlighted the necessity to scrutinize trade policies due to rising economic and price risks [1]

Core Viewpoint - The Governor of the Bank of Japan, Kazuo Ueda, believes that the downward risks to the economy and prices are more severe [1] Economic Outlook - The Bank of Japan is facing significant challenges regarding economic stability and inflation control [1] - There is an increasing concern about the potential for economic contraction and deflationary pressures [1] Price Stability - Ueda's comments indicate a heightened awareness of the risks associated with maintaining price stability in the current economic environment [1] - The central bank may need to reassess its monetary policy strategies in light of these risks [1]

Core Insights - Consumer confidence in the U.S. has improved for the first time in six months, rising by 16% compared to the previous month, but remains approximately 20% lower than in December 2024, when confidence rebounded post-election [1][1][1] Summary by Categories Consumer Confidence - All five components of the consumer confidence index have increased, with particularly significant gains in short-term and long-term expectations regarding business conditions, aligning with perceptions of eased tariff pressures [1][1] Economic Outlook - Consumers appear to have partially recovered from the impact of high tariffs announced in April and subsequent policy fluctuations, yet they still perceive widespread downside risks to the economy [1][1] Financial Sentiment - Despite the noticeable improvement in economic conditions this month, consumers maintain a cautious and worried outlook regarding the economy, with views on business conditions, personal financial situations, commodity purchasing conditions, labor market, and stock market all significantly lower than six months ago [1][1][1]

1. Report Industry Investment Ratings No relevant content provided. 2. Core Views of the Report - Geopolitical risks in the Middle East are rising rapidly, with Trump indicating that Israel may attack Iran, which will lead to a short - term weakening of the US dollar index and a strong rise in gold prices [2][3][16][20]. - The US economic data shows signs of weakness, such as the initial jobless claims and May PPI being weaker than expected, which affects the performance of various financial and commodity markets [15][16][23][24]. - Different commodity markets have different trends. For example, the soybean meal in the agricultural product market is relatively strong but is expected to fluctuate around 3000; the sugar market is expected to be weak due to the expected increase in Brazilian sugar production; the coal price in the black metal market may experience a second dip; and the silicon material market in the non - ferrous metal market is facing price decline risks [30][36][39][50]. 3. Summary by Directory 3.1 Financial News and Comments 3.1.1 Macro Strategy (Gold) - Trump said that Israel's attack on Iran is "very likely", and the US economic data is weak. The initial jobless claims and May PPI are weaker than expected. Gold prices are expected to be strong with increased volatility [14][15][16]. 3.1.2 Macro Strategy (Foreign Exchange Futures - US Dollar Index) - Trump's statement that Israel may attack Iran accelerates the rise of geopolitical risks, and the US dollar index is expected to continue to weaken in the short term [19][20]. 3.1.3 Macro Strategy (US Stock Index Futures) - The US imposes tariffs on steel - made household appliances, and the unemployment benefit application data is weak. The US stock market is still in a volatile situation, and it is not recommended to chase high [22][23][25]. 3.1.4 Macro Strategy (Treasury Bond Futures) - The central bank conducts 1193 billion yuan of 7 - day reverse repurchase operations. The long - term bonds lack the driving force to break through directly. The market is expected to be volatile in the near future, and investors should seize the opportunity to buy on dips [26][27]. 3.2 Commodity News and Comments 3.2.1 Agricultural Products (Soybean Meal) - CONAB and the Buenos Aires Grain Exchange raise the soybean production forecasts of Brazil and Argentina respectively. The domestic soybean meal is stronger than the external market but is expected to fluctuate around 3000 [28][29][30]. 3.2.2 Agricultural Products (Soybean Oil/Rapeseed Oil/Palm Oil) - The Trump administration is expected to propose a biodiesel quota lower than 5.25 billion gallons. Investors holding long positions are advised to exit [31][33]. 3.2.3 Agricultural Products (Sugar) - The market expects an increase in sugar production in the central - southern region of Brazil in the second half of May. The domestic sugar market is expected to be weak, and the Zhengzhou sugar futures are expected to be weak with fluctuations [36][37]. 3.2.4 Black Metals (Steam Coal) - The steam coal price in the northern port market is temporarily stable, but it may experience a second dip due to factors such as weak power consumption demand [38][39]. 3.2.5 Black Metals (Iron Ore) - Roy Hill and Atlas Iron plan to merge. The iron ore price is expected to decline slightly with the weakening of terminal demand, but the decline will be gentle [40]. 3.2.6 Agricultural Products (Pigs) - The short - to medium - term pig price may be pessimistic, but the supply pressure may ease in the third to fourth quarter. It is recommended to wait and see [42][43]. 3.2.7 Black Metals (Rebar/Hot - Rolled Coil) - The inventory of five major steel products has decreased, but the performance of building materials and coils is differentiated. The steel price is expected to be weak with fluctuations [44]. 3.2.8 Agricultural Products (Corn Starch) - The consumption of corn by deep - processing enterprises has decreased, and the supply - demand situation may gradually improve. The CS07 - C07 is expected to be in low - level fluctuation [46]. 3.2.9 Agricultural Products (Corn) - The corn inventory of major processing enterprises has decreased, and the corn inventory is tightening. The 09 contract is expected to be strong first and then weak, with fluctuations [47][48]. 3.2.10 Non - Ferrous Metals (Polysilicon) - The price of N - type silicon wafers has slightly decreased. The spot market is bearish in the short term, but the price decline may stimulate silicon material manufacturers to cut production. A short - term short and long - term long strategy is considered [49][50][51]. 3.2.11 Non - Ferrous Metals (Industrial Silicon) - Some silicon plants in Sichuan have resumed production, and the demand is still weak. The disk price is expected to be in low - level fluctuation, and shorting on rebounds can be considered [53]. 3.2.12 Non - Ferrous Metals (Nickel) - The LME nickel inventory has increased. The short - term fundamental support exists, and it is recommended to wait and see. Options can be used to replace futures positions, and shorting on rebounds can be considered in the medium term [54][55]. 3.2.13 Non - Ferrous Metals (Lithium Carbonate) - The inventory pressure in June has been significantly relieved. It is recommended to pay attention to shorting opportunities on rebounds [58]. 3.2.14 Non - Ferrous Metals (Lead) - The lead price has oscillated upwards, and the supply is expected to decrease. It is recommended to wait and see in the short term and pay attention to medium - term long - buying opportunities [59][60]. 3.2.15 Non - Ferrous Metals (Zinc) - The zinc price has fluctuated widely, and the supply - demand pattern is expected to be strong in supply and weak in demand. It is recommended to short on rebounds and pay attention to the arrival situation in Shanghai [63][64]. 3.2.16 Energy Chemicals (Liquefied Petroleum Gas) - The domestic LPG commodity volume has increased, and the inventory has decreased. The spot price has limited upward momentum, and the disk is expected to be weak with fluctuations [66][67]. 3.2.17 Energy Chemicals (Carbon Emissions) - The National Energy Administration organizes hydrogen energy pilot projects. The CEA is expected to be volatile in the short term [68][70]. 3.2.18 Energy Chemicals (Natural Gas) - The US natural gas inventory has increased. It is recommended to wait and see [71][72]. 3.2.19 Energy Chemicals (PTA) - The demand for PTA is in the off - season, and the supply has increased. The short - term price faces pressure, and long - term long positions can be considered on dips [73][74]. 3.2.20 Energy Chemicals (Caustic Soda) - The price of caustic soda in Shandong is stable. The 09 contract of caustic soda is affected by the overall weakness of commodities, but the large discount on the disk will limit the downward space [75][77]. 3.2.21 Energy Chemicals (Pulp) - The price of imported wood pulp has continued to decline. The disk is expected to be volatile [78][79]. 3.2.22 Energy Chemicals (PVC) - The spot price of PVC has slightly increased, and the disk is expected to be volatile [80][81]. 3.2.23 Energy Chemicals (Urea) - The pre - sales of urea production enterprises have decreased. The urea price is expected to be weak in the long term, and attention can be paid to the possibility of policy relaxation [80][82]. 3.2.24 Energy Chemicals (Bottle Chips) - The supply pressure of bottle chips is large, and the processing fee is under pressure. It is recommended to build long positions on dips to expand the processing fee [85]. 3.2.25 Energy Chemicals (Soda Ash) - The soda ash price has declined significantly, and the market is in weak and stable adjustment. It is recommended to short on rebounds in the medium term [86]. 3.2.26 Energy Chemicals (Float Glass) - The float glass price has slightly decreased. The demand will decline seasonally, and the price is expected to be weak [87][88].

Investment Rating - The report maintains a rating of "Overweight" for the non-ferrous metals sector [1]. Core Views - The non-ferrous metals sector experienced a weekly increase of 3.74%, ranking it second among all primary industries. The industrial metals segment saw a rise due to optimistic macroeconomic sentiments following the U.S. non-farm payroll data [1][15]. - The report highlights that while industrial metals are showing strength, there are underlying concerns regarding demand, particularly for copper and aluminum, which are facing seasonal slowdowns [2][37]. Summary by Sections Market Review - The Shanghai Composite Index rose by 1.13%, with 25 out of 31 sectors increasing. The non-ferrous metals sector outperformed the index by 2.61 percentage points [15]. - The small metals and new materials sectors saw increases of 5.07% and 5.15%, respectively, while industrial metals rose by 3.24% [15]. Industrial Metals - **Copper**: Prices for copper increased, with LME copper at $9,671 per ton (up 1.83%) and SHFE copper at ¥78,930 per ton (up 1.71%). However, downstream demand is weakening, leading to inventory accumulation [2][32]. - **Aluminum**: LME aluminum prices reached ¥2,452 per ton (up 0.12%), while SHFE aluminum remained stable at ¥20,070 per ton. Demand is declining, limiting upward price movement [3][37]. - **Zinc**: Zinc prices increased, with LME zinc at $2,663 per ton (up 1.25%) and SHFE zinc at ¥22,385 per ton (up 0.72%). Inventory levels showed mixed trends [42]. - **Tin**: Tin prices rose significantly, with LME tin at $32,255 per ton (up 6.70%) and SHFE tin at ¥263,600 per ton (up 5.31%) due to supply disruptions [45]. Precious Metals - **Gold**: COMEX gold closed at $3,331.10 per ounce (up 0.54%), while SHFE gold was at ¥783.24 per gram (up 2.48%). The market is reacting to mixed economic signals, with recent non-farm payroll data providing temporary relief from recession fears [4][48].

Core Insights - Federal Reserve Governor Waller indicated that the economy and labor market face downside risks, while inflation is under upward pressure [1] - The impact of tariffs on inflation may become most pronounced in the second half of 2025 [1] Economic Outlook - The economy is experiencing potential downturns, which could affect overall growth and stability [1] - The labor market is also showing signs of vulnerability, suggesting a need for caution in economic forecasts [1] Inflation Concerns - Inflationary pressures are expected to rise, indicating challenges for monetary policy and consumer purchasing power [1] - The timing of tariff impacts on inflation suggests a delayed effect, with significant implications for economic planning and strategy in 2025 [1]