Core Viewpoint - The Federal Reserve is expected to continue lowering interest rates in December, with a preference for a 50 basis point reduction to reach a neutral rate, although some colleagues favor a 25 basis point adjustment [1] Group 1 - The Federal Reserve Board member, Milan, anticipates a continuation of rate cuts in December [1] - There is a divergence in opinions among Federal Reserve officials regarding the pace of rate cuts, with some advocating for a more gradual approach [1]

Core Viewpoint - The President of the New York Federal Reserve, Williams, expressed difficulty in controlling the neutral interest rate, indicating that model-based expectations for the U.S. neutral interest rate are around 1% [1] Group 1 - The bond market suggests that the R* (neutral interest rate) is higher than 1%, but Williams disagrees with this assessment [1]

Core Viewpoint - The Federal Reserve is experiencing internal differences regarding the pace of interest rate cuts, with new member Milan advocating for a rate cut in December due to easing inflation and a moderately cooling labor market [1][3]. Group 1: Interest Rate Policy - Milan believes the current interest rate is slightly above the neutral level, suggesting that monetary conditions may be suppressing economic activity, and he supports a quicker return to a balanced rate to alleviate potential economic pressures [3]. - There is no consensus within the Federal Reserve, as some officials emphasize the need to monitor inflation and oppose premature easing, indicating a shift in discussions from "whether to cut rates" to "how to arrange the pace of cuts" [3][4]. Group 2: External Economic Environment - Milan highlights that uncertainties in trade and tariffs could impact economic expectations, suggesting that changes in external costs or policy expectations may influence corporate planning and market behavior, thereby affecting the applicable interest rate level [3]. - The current market remains focused on U.S. employment and price trends, with recent employment data showing a slowdown in growth but still adding jobs, and wage growth declining, indicating a moderate cooling phase rather than a rapid contraction [3][4]. Group 3: Data-Driven Policy Approach - The Federal Reserve's approach to rate cuts has entered a more data-dependent phase, with increased discussions on the pace and magnitude of changes, reflecting varying data focus among officials [4]. - Future interest rate changes are likely to be more driven by economic data, including macroeconomic indicators, consumer changes, employment trends, and price levels, making market reactions more sensitive to data release timings [4].

Core Viewpoint - The Bank of England is expected to maintain the benchmark interest rate at 4%, potentially ending the gradual rate cuts that began in August 2024, amid easing inflation pressures and signs of economic slowdown [1][2]. Economic Indicators - The Consumer Price Index (CPI) in September remained stable at a year-on-year increase of 3.8%, lower than the previously anticipated peak of 4% by the central bank [1]. - The Bank of England's Governor Andrew Bailey noted that the economy is operating "below potential growth levels," with a weakening labor market [1]. Monetary Policy Committee (MPC) Dynamics - There is a clear division within the MPC regarding the interest rate decision, with a survey indicating 6 votes for maintaining the rate and 3 votes for a cut [1]. - Hawkish members, including Chief Economist Huw Pill, express concerns over inflation remaining significantly above the 2% target, while others favor a rate cut to address economic slowdown and reduced employment demand [1][2]. Upcoming Meetings and Reports - The upcoming meeting will introduce a new Monetary Policy Report and minutes, marking a significant change in communication, where each MPC member will explain their voting rationale [2]. - The report will include an overview section integrating baseline forecasts, economic outlook, and policy logic, influenced by former Fed Chair Ben Bernanke's policy recommendations [2]. Fiscal Policy Considerations - The upcoming autumn budget, expected to include significant tax increases, aims to suppress inflation and create conditions for the Bank of England to lower key rates [2]. - Chancellor Rachel Reeves emphasized that her decisions will focus on reducing inflation and supporting economic growth while managing government debt [2]. Market Expectations - Analysts from various institutions suggest a possibility of an unexpected rate cut of 25 basis points to 3.75% during the meeting, reflecting the difficult balance between resilient inflation, weak economic growth, and forthcoming fiscal policies [3]. - Regardless of the decision, the Bank of England is likely to continue emphasizing a "gradual meeting" decision-making principle and reaffirming that rates are approaching a "neutral zone" [3].

Core Viewpoint - The USD/CHF exchange rate is currently experiencing a strong oscillation supported by fundamentals, trading around 0.8089 after reaching a psychological level of 0.8100 in the North American session [1] Group 1: USD Performance - The recent strength of the USD is attributed to the Federal Reserve's "hawkish easing" stance, despite a 25 basis point rate cut last week [1] - The Fed's communication suggests that further easing is not guaranteed, leading to a reduction in market expectations for a December rate cut, which supports the USD [1] - The USD index has surpassed 100.00, reaching its highest level since early August, with an increase of nearly 0.20% on that day [1] Group 2: CHF Performance - The Swiss Franc's performance is influenced by weaker-than-expected inflation data, raising market speculation about the Swiss National Bank potentially discussing a "broader toolbox" for easing [2] - Although a shift to a more accommodative policy is not imminent, it could lower neutral interest rates and real interest differentials, diminishing the relative attractiveness of the CHF [2] Group 3: Technical Analysis - The resistance level for the USD/CHF pair is identified at 0.8100, with a prior high retracement level at 0.8098 [2] - Support levels are seen at 0.8080 (the mid-point of the trading range) and 0.8066 (the lower boundary of the range), with a significant static support at 0.8035 if the price drops below these levels [2]

Report Industry Investment Rating - The investment rating for zinc is "stronger operation" [1] Core View - The zinc market is expected to run strongly, with a trend strength of 0, indicating a neutral - to - slightly - positive outlook [1][3] Summary According to Related Content 1. Zinc Market Data - **Prices**: The closing price of SHFE zinc main contract was 22,565 yuan/ton, up 0.94% from the previous day; the closing price of LME zinc 3M electronic disk was 3,050 dollars/ton, up 0.18% [1] - **Volumes**: The trading volume of SHFE zinc main contract was 140,709 lots, an increase of 47,145 lots; the trading volume of LME zinc was 8,918 lots, a decrease of 1,501 lots [1] - **Open Interests**: The open interest of SHFE zinc main contract was 118,939 lots, an increase of 2,530 lots; the open interest of LME zinc was 223,429 lots, an increase of 1,194 lots [1] - **Premiums and Discounts**: Shanghai 0 zinc premium/discount was - 30 yuan/ton, unchanged; LME CASH - 3M premium/discount was 85.57 dollars/ton, down 10.45 dollars/ton [1] - **Inventories**: SHFE zinc futures inventory was 67,649 tons, a decrease of 125 tons; LME zinc inventory was 33,825 tons, a decrease of 1,475 tons [1] 2. News - The US ISM manufacturing PMI in October dropped to 48.7%, contracting for eight consecutive months, with weak demand and employment and cooling inflation [1] - Fed Governor Milan believes that Fed policy is too tight and a series of 50 - basis - point rate cuts should be made to achieve a neutral interest rate [1]

Core Viewpoint - Federal Reserve Governor Stephen Miran advocates for significant interest rate cuts, arguing that current monetary policy is overly restrictive and that the neutral interest rate is much lower than the current policy rate [2][3] Group 1: Monetary Policy Stance - Miran emphasizes that the Federal Reserve's policy is too tight, suggesting that a series of 50 basis point cuts could reach the neutral rate without needing 75 basis points [2] - He has consistently opposed recent rate cuts, voting against the 25 basis point reductions in September and October, advocating instead for a 50 basis point cut [2] - Following a second consecutive month of a 25 basis point cut, the target range for the benchmark rate is now 3.75% to 4% [2] Group 2: Economic Indicators and Risks - Miran points to recent pressures in the credit market as indicators of overly tight monetary policy, suggesting that these issues may reflect broader economic risks [3] - He argues that focusing too heavily on stock market performance and corporate credit strength can misrepresent the true stance of monetary policy [3] - The performance of interest-sensitive sectors, such as the housing market, and pressures in private credit markets indicate that current monetary policy may be contributing to economic downturn risks [3] Group 3: Independence Concerns - Miran's temporary appointment to the Federal Reserve, following his role as chair of the White House Council of Economic Advisers, raises questions about his independence and potential influence from the Trump administration [4]

Core Viewpoint - The Federal Reserve's monetary policy is still considered restrictive, and there is a strong advocacy for significant interest rate cuts by Stephen Milan, a member of the Federal Reserve Board [1] Group 1 - Stephen Milan believes that the current policy level is significantly above the neutral interest rate [1] - Milan expresses a more optimistic outlook on inflation compared to some other committee members, questioning the rationale for maintaining such a restrictive policy [1]

Core Viewpoint - The Federal Reserve Governor Milan stated that the neutral interest rate is significantly lower than the current policy level, suggesting that a series of 50 basis point rate cuts could achieve the neutral rate without the need for 75 basis point cuts [1] Group 1 - The Federal Reserve may implement a series of 50 basis point rate cuts to reach the neutral interest rate [1] - There is no necessity for a 75 basis point cut to achieve the neutral rate [1]

Group 1 - The Federal Reserve has lowered the policy interest rate to 3.75%–4.0% and will stop quantitative tightening from December 1, indicating a focus on maintaining market liquidity [1][2] - There is significant internal disagreement within the Federal Reserve regarding future interest rate policies, with some members opposing further rate cuts [2] - The U.S. economy is growing at approximately 3.9%, but inflation remains a concern, complicating the decision-making process for interest rate adjustments [2] Group 2 - Silver has decoupled from gold recently, with silver prices rising while gold continues to decline, driven by a strong dollar and reduced geopolitical risks [3][4] - Silver's dual financial and industrial attributes make it particularly valuable in the context of the green energy transition, with significant demand from the solar and electric vehicle industries [4][5] - The historical gold-to-silver ratio is currently at 82, which is still high compared to the typical range of 50–70, suggesting potential for silver to catch up, although the primary drivers for precious metal price increases are financial rather than industrial [5][6]