Group 1: CPI Overview - The US CPI for August increased by 2.9% year-on-year and 0.4% month-on-month, aligning with expectations[1] - Core CPI rose by 3.1% year-on-year and 0.3% month-on-month, meeting forecasts[1] - The overall CPI growth rate is consistent with expectations, indicating a moderate transmission of tariffs on inflation[1] Group 2: Food and Energy Impact - Food prices increased by 0.5% month-on-month, with significant rises in tomatoes (4.5%), eggs (3.9%), coffee (3.6%), and apples (3.5%)[2] - Energy prices rose by 0.7% month-on-month, reversing a previous decline of -1.1%, driven by geopolitical tensions and increased summer travel demand[2] - Brent crude oil prices slightly decreased to $67.49 per barrel, indicating a stable outlook for oil prices despite recent fluctuations[2] Group 3: Market Reactions and Future Outlook - Following the CPI release, market expectations for rate cuts in September and October increased, with a projected 25 basis points reduction[1] - The upcoming FOMC meeting will focus on the potential for further rate cuts and the impact of employment data on inflation trends[3] - Concerns about long-term inflation risks remain, despite short-term pressures being manageable[3]

Core Viewpoint - The Federal Reserve is preparing to implement its first interest rate cut of the year amidst a divided stance among its members, balancing a weakening job market against inflation risks from President Trump's tariff policies [1][2]. Group 1: Interest Rate Decision - Investors widely expect the Federal Open Market Committee (FOMC) to announce a 25 basis point rate cut in the upcoming policy vote [1]. - There is a possibility of a "three-way split" vote, indicating a lack of consensus on the action to be taken, with some members advocating for a larger cut while others prefer to maintain current rates [2]. Group 2: Economic Indicators - The core disagreement among Fed officials revolves around the assessment of tariffs' impact on inflation, with some officials believing that inflation risks remain despite a 4.3% unemployment rate [3]. - Recent economic data, including a rise in initial jobless claims to the highest level since 2021 and the first monthly job loss since the pandemic, are being cited as reasons for more aggressive rate cuts [3][4]. Group 3: Political Pressures - The meeting is also influenced by unique political pressures, including ongoing attacks from President Trump on Fed Chair Powell and the potential implications of these pressures on the Fed's decision-making independence [5]. - Some analysts suggest that a hawkish dissenting vote could politically benefit Powell by balancing the pressure for aggressive cuts from Trump and his appointees [5]. Group 4: Future Guidance - The complex economic backdrop and tense political climate suggest that future policy guidance from the Fed will be uncertain, with the upcoming quarterly economic forecast expected to show a wide range of opinions among committee members [5][7]. - The economic projections are anticipated to be highly dispersed, reflecting the varied views within the committee [7].

Group 1 - The actual effective tariff rate in the U.S. is estimated to be around 9%-10%, significantly lower than the theoretical rate of approximately 18%, indicating that the negative impact of tariffs on inflation and corporate profits is overstated [1][2] - The report highlights that the discrepancy between theoretical and actual tariff rates is primarily due to policy exemptions rather than transshipment practices, suggesting a deliberate choice by policymakers to maintain lower tariffs [3] - The report notes that the current trade war situation is more favorable for risk assets and provides the Federal Reserve with room to lower interest rates amid a weak labor market [1] Group 2 - The report identifies a significant gap between the announced tariff levels and the actual effective rates, with the theoretical effective tariff rate estimated at 17%-18%, the highest since the Smoot-Hawley Tariff Act, while the actual rate is around 10% [2] - Policy exemptions are cited as the main reason for the lower effective tariff rates, with a high approval rate of 61% for tariff exemption applications submitted by companies between 2018 and 2021 [3] - The analysis of tariff impacts shows that the anticipated "tariff-flation" has not materialized, with the annualized growth rate of the tariff basket's prices remaining moderate at 2% [4] Group 3 - The report indicates that U.S. companies engaged in significant import stockpiling before the tariffs took effect, which may lead to a potential spike in goods inflation as these inventories are depleted [4] - Evidence supporting the notion that companies are absorbing tariff costs by compressing their profits is limited, as profit margins for the S&P 500 index remain stable [4]

Core Viewpoint - The actual effective tariff rate in the U.S. is only around 9%-10%, significantly lower than the theoretical rate of approximately 18%, indicating that the negative impact of tariffs on inflation and corporate profits is overstated [1][3][5] Group 1: Tariff Impact Analysis - The report highlights a significant discrepancy between the theoretical effective tariff rate (17%-18%) and the actual effective rate (around 10%), suggesting that the real impact of the trade war is less severe than perceived [5][6] - The primary reason for this discrepancy is attributed to policy exemptions and carveouts rather than transshipment practices, which are believed to have a limited effect [6][7] - The "tariff-flation" effect has not materialized as expected, with the annualized growth rate of the tariff basket's prices remaining moderate at 2% [8] Group 2: Inventory and Profitability Concerns - U.S. companies have engaged in significant import stockpiling prior to the tariffs, with excess imports equivalent to 5-6 months of normal import levels, indicating that inventory buffers are nearing depletion [9] - There is limited evidence to support the notion that companies are absorbing tariff costs by compressing their profits, as profit margins for the S&P 500 remain stable [9]

Core Insights - The actual impact of the trade war on the US economy is significantly less severe than commonly perceived, with the effective tariff rate estimated at only 9%-10%, compared to a theoretical rate of about 18% [1][2] - The lower-than-expected tariff impact is primarily due to policy exemptions rather than transshipment practices, indicating a deliberate choice by policymakers [1][3] Group 1: Tariff Rates and Their Implications - The theoretical effective tariff rate based on announced tariffs is estimated to be 17%-18%, the highest since the Smoot-Hawley Tariff Act, while the actual effective rate is around 10% [2] - The discrepancy between theoretical and actual tariff rates suggests that the trade war's real effects are not as alarming as they appear [2] Group 2: Factors Mitigating Tariff Impact - Policy exemptions (Carveouts) are identified as a key reason for the lower effective tariff rate, with a significant number of exemption applications approved historically [4] - Transshipment activities, while present, have a limited effect on reducing overall tariff rates, contributing only about 1 percentage point to the effective rate reduction [4] Group 3: Future Risks and Market Reactions - US companies have built up significant inventory buffers prior to the implementation of tariffs, which are now nearing depletion, potentially leading to increased inflation in the coming months [5] - Evidence supporting the notion that companies are absorbing tariff costs by compressing profits is limited, as profit margins for the S&P 500 remain stable [6]

Core Viewpoint - The article discusses the recent performance of the U.S. stock market, inflation data, and the implications for investment in Chinese assets, highlighting a potential shift in investor focus towards China due to favorable conditions. Group 1: U.S. Stock Market Performance - On September 11, the three major U.S. stock indices all closed higher, with the Dow Jones up 1.36%, the S&P 500 up 0.85%, and the Nasdaq up 0.72%, all reaching historical highs [1]. - Major tech stocks showed mixed results, with Tesla rising over 6% due to strong demand expectations, while other tech giants like Apple and Google saw modest gains [3][4]. Group 2: U.S. Inflation Data - The U.S. Consumer Price Index (CPI) for August increased by 0.4% month-on-month, with a year-on-year increase of 2.9% before seasonal adjustment. Core CPI, excluding volatile food and energy prices, rose by 0.3% month-on-month and 3.1% year-on-year [3]. - Specific price pressures were noted in various categories, including a 1.6% increase in fruit and vegetable prices and a 1.8% rise in automotive fuel prices, indicating ongoing inflationary pressures [3]. Group 3: Chinese Market Insights - The Nasdaq Golden Dragon China Index rose by 2.89%, with significant gains in Chinese stocks such as Alibaba, which increased by 8%, marking a nearly four-year high [5][7]. - Morgan Stanley reported that U.S. investors' interest in the Chinese market has reached its highest level since 2021, driven by a combination of external and internal factors [9]. - The article highlights that the recent rebound in Chinese assets is supported by a weaker dollar, a shift in Chinese policy towards stabilizing expectations and cash flows, and improved earnings from leading companies [10]. Group 4: Future Outlook for Chinese Assets - Analysts predict that the Nasdaq Golden Dragon China Index may enter a phase of "stepwise upward movement with high volatility," with potential to reach between 8500 and 9000 points, although frequent pullbacks are expected [10]. - The future performance of Chinese assets will depend on fundamental, macroeconomic, and microeconomic factors, including the sustainability of earnings from leading companies and ongoing capital market reforms [11].

Core Viewpoint - The U.S. labor market is showing signs of cooling, with expectations for a 25 basis point rate cut by the Federal Reserve in September fully priced in, and two additional cuts anticipated for the year [1] Group 1: Labor Market and Economic Indicators - The non-farm payroll data needs to be significantly worse than expected to alter the current narrative of rate cuts and exert pressure on the U.S. dollar [1] - Conversely, if the data exceeds expectations, the U.S. dollar may strengthen again [1] Group 2: Inflation and Market Sentiment - There are ongoing concerns regarding inflation driven by tariffs, and any signs of rising inflation could challenge bearish positions on the U.S. dollar [1] - The U.S. dollar index has declined alongside softening U.S. Treasury yields, indicating a potential shift in market sentiment [1] Group 3: Technical Analysis - Daily momentum indicators are showing mild bullish signs, while the Relative Strength Index (RSI) remains neutral, suggesting that the U.S. dollar may face risks of two-way fluctuations in the short term [1]

Group 1 - The Ministry of Commerce announced China's first anti-circumvention investigation ruling, determining that U.S. exporters circumvented anti-dumping measures on non-dispersive single-mode optical fibers by exporting related cutoff wavelength shifted single-mode optical fibers to China. Anti-circumvention measures will be implemented from September 4 [1] - In August, the U.S. ADP employment increased by 54,000, significantly below the market expectation of 65,000, with a revised figure of 104,000 for July. The ISM services PMI for August was reported at 52, marking the fastest expansion in six months, driven by the strongest growth in orders in nearly a year [1][5] Group 2 - In the dual-fuel market, the main contract showed a strong trend, with a continued decrease in coking coal positions. Steel production from the five major materials decreased week-on-week, while total inventory continued to accumulate, particularly in hot-rolled coil [2][25] - Methanol prices increased by 1.18% in the night session, with a significant rise in the number of imported cargoes arriving at ports. Coastal methanol inventory reached 1.3985 million tons, a historical high, with a week-on-week increase of 99,000 tons [3][14] - In the precious metals market, gold prices fell after a period of consolidation, with market focus on upcoming non-farm payroll data. Concerns arose regarding potential import tariffs on silver as the U.S. Geological Survey proposed including silver in a list of critical minerals [4][18] Group 3 - The State Council issued opinions to enhance the potential of sports consumption and promote high-quality development in the sports industry, emphasizing increased financial support and encouraging sports enterprises to go public [6] - The Ministry of Industry and Information Technology and the State Administration for Market Regulation released an action plan for stable growth in the electronic information manufacturing industry, targeting an average growth rate of around 7% for major sectors from 2025 to 2026 [7]

Group 1 - The Jackson Hole meeting highlighted three key messages from Powell: increasing downside risks in the labor market, temporary inflation due to tariffs, and a still tight policy stance [1] - The probability of a rate cut by the Federal Reserve in September has increased, with expectations of a 25 basis point cut to align with Powell's gradual and data-driven approach [1] - Market focus is on whether the Fed will implement a moderate 25 basis point cut or a larger 50 basis point cut, depending on upcoming labor market data [1] Group 2 - The expectation of rate cuts may lead to depreciation pressure on the US dollar, influenced by concerns over the independence of the Fed under the Trump administration [2] - The company prefers currencies supported by hawkish central banks, such as the Japanese yen and euro, as well as high-yield Asian currencies like the Indian rupee [2] - In Asia, markets driven by domestic demand are favored, with China benefiting from monetary easing and fiscal stimulus, while India’s GST reform and lower loan rates are expected to support consumption and stock market performance [2]

Group 1: Monetary Policy Outlook - The Jackson Hole meeting indicated a shift towards a dovish stance, lowering the threshold for a rate cut in September[1] - Powell highlighted a significant slowdown in job growth, with an average of only 35,000 non-farm jobs added over the past three months, compared to 168,000 per month in 2024[1] - The current policy rate is between 4.25% and 4.5%, above the neutral rate of 3%, suggesting a need for adjustment in monetary policy[1] Group 2: Economic Indicators - The GDP growth rate for the first half of 2025 is only 1.2%, significantly lower than the 2.5% growth rate in 2024[1] - Powell noted that inflation risks from tariffs are likely to be one-time events rather than persistent, as the labor market is weak and long-term inflation expectations remain anchored[1] - The market currently prices in an expectation of 2.2 rate cuts for the year, which may be overly optimistic given the upcoming economic data releases[3] Group 3: Future Projections - In an optimistic scenario, the expectation is for rate cuts in September and December, with a total reduction of no more than 50 basis points for the year[5] - By May 2026, with a new Fed chair, the monetary policy is expected to become more accommodative, with projections of 4 to 6 rate cuts next year under different scenarios[5] - Following the September FOMC meeting, market expectations for rate cuts in 2026 are likely to increase, impacting the 2-year Treasury yield and the dollar index[5]