Inflation Data Summary - In March 2025, the US CPI increased by 2.4% year-on-year, down from 2.8% in the previous month and below the market expectation of 2.5%[2] - The seasonally adjusted CPI decreased by 0.1% month-on-month, compared to an increase of 0.2% in the previous month[2] - The core CPI rose by 2.8% year-on-year, lower than the previous value of 3.1% and the market expectation of 3.0%[2] - The seasonally adjusted core CPI increased by 0.1% month-on-month, down from 0.2% in the previous month[2] Key Drivers of Inflation Changes - The decline in inflation was primarily driven by falling energy and airfare prices, with energy prices dropping by 3.3% year-on-year in March[5] - The impact of tariffs has not yet been fully realized, as prior "import rush" led to increased inventories, keeping prices stable for now[4] - Starting in April, the implementation of high tariffs on imports from China and a 10% tariff on other countries is expected to create supply shortages and cost increases, leading to upward pressure on inflation[3][4] Future Implications - The increase in average effective tariff rates to 22.5% is projected to raise US inflation by approximately 1.7 percentage points due to the significant tariff hikes[8] - Concerns over tariffs are causing market volatility, with significant declines in stocks, bonds, and currencies, while gold prices have surged[8] - The Federal Reserve may adopt a wait-and-see approach regarding interest rate cuts due to the uncertainty surrounding trade policies and their inflationary impacts[10]

Inflation Data Summary - In March, the U.S. CPI experienced a month-on-month decline of -0.1%, marking the first negative growth since June 2024[9] - Year-on-year CPI growth significantly dropped to 2.4%, indicating a substantial cooling of inflation[9] - Core CPI also fell to 2.8%, the lowest level since March 2021[9] Energy and Commodity Prices - The year-on-year growth rate for the energy component of CPI fell to -3.3%, a decrease of 3.1 percentage points from the previous month[12] - Brent crude oil prices averaged $72.7 per barrel in March, declining to $71.5 per barrel in April due to OPEC+ production increases and concerns over U.S. tariffs[12] - Core commodity prices saw a month-on-month decline of -0.1%, with used car, furniture, and clothing prices decreasing[17] Service Sector Insights - Core service inflation year-on-year growth decreased to 3.7%, down 0.4 percentage points from the previous month[20] - The month-on-month growth rate for core services fell to 0.1%, driven by lower prices in auto insurance, airfare, and entertainment services[20] Market Expectations and Risks - Following the inflation data release, market expectations for Federal Reserve rate cuts increased, with projections rising to an average of 3.5 cuts for the year[26] - There is a potential risk of inflation rebounding due to the implementation of tariffs, which could raise inflation by at least 0.6% if a comprehensive 10% tariff is enacted without retaliation[3][29] - Risks include unexpected monetary tightening by the Federal Reserve and a potential downturn in the U.S. economy[4][31]

报 告 正 文 CPI环比转负，核心CPI同比录得近四年新低 。 3月美国CPI环比增速转负至-0.1%，为2024年6月以来首次 转负。3月同比增速大幅回落至2.4%，通胀大幅降温。同时，3月核心CPI同比降至2.8%，录得2021年3月 以来新低。 从分项来看，能源和核心服务同比增速回落，是通胀降温的主要动力 。一方面，OPEC+宣布 增产，叠加市场担忧全球需求减少，油价下行，带动能源项同比增速降幅走扩。另一方面，核心服务通胀 延续回落趋势，本月主要受益于汽车保险费、机票的同比增速回落 。 商品通胀环比转负，但随着关税落地，存在回升风险 。 本月家具、二手车和服装价格环比增速下行。不 过，新车环比增速有所反弹，主因消费者在关税实施前进行抢购。根据PIIE测算，若不考虑报复情形， 10%的全面关税或使得通胀年内上升至少0.6%。随着4月特朗普关税政策正式生效，年内商品通胀存在上 行风险 。 能源项同比大幅回落 。3月CPI能源项同比增速录得-3.3%，较上月大幅下行3.1个百分点。其中，汽油项同 比增速降幅较上月收窄至-9.8%，下降6.7个百分点。3月布伦特原油现货均价降至72.7美元/桶，OPEC+宣 ...

1. Report Industry Investment Rating No relevant content provided. 2. Core View of the Report - The significant decline in the US CPI data in March 2025 has strengthened the market's expectation of a Fed rate cut in June, with an expected annual rate cut of up to 100 basis points. However, geopolitical conflicts and tariff policies may push up inflation, forcing the Fed into a dilemma between rate cuts and inflation control, and even delaying the easing cycle [3][26][27]. - The labor market is showing marginal cooling, with strong employment but weakening wage pressure, which provides policy flexibility for the Fed. Asset trends are complex and differentiated, reflecting the market's game between rate - cut expectations and inflation rebound risks [4]. - Although the overall US inflation is cooling, the inflation structure shows that commodity inflation is deflationary while service inflation is sticky. If tariffs are fully implemented, inflation may rebound [17][26][27]. 3. Summary by Relevant Catalog 3.1 CPI vs Core CPI - In March 2025, the US CPI increased by 2.4% year - on - year and decreased by 0.1% month - on - month, the first negative growth since 2020. The core CPI dropped to 2.8%, the lowest since March 2021, indicating a phased relief of overall inflation pressure [10]. - The decline in CPI is mainly due to the fall in energy prices, while the core CPI still shows certain stickiness, especially in service costs and housing rents. Short - term CPI decline may stimulate rate - cut expectations, but there are still risks of inflation rebound [10]. 3.2 Commodity - type Inflation vs Service - type Inflation - In March 2025, the overall US inflation was moderately cooling, but from a structural perspective, commodity prices were almost flat, with a significant decline in energy prices, while service - type CPI still increased by 3.7% year - on - year. Housing - related items were an important source of core CPI stickiness [17]. - Trump's tariff policy adjustment may cause US commodity inflation to rise again in the coming months, while service - type inflation declines more slowly due to structural factors. The current structure of commodity deflation and service inflation still exists, and inflation may face upward risks [17]. 3.3 Impact of Inflation - The decline in the US CPI data in March has strengthened the market's expectation of a Fed rate cut in June. However, if tariffs are fully implemented, it may push up inflation and force the Fed into a dilemma [26][27]. - Geopolitical conflicts and tariff policies increase the risk of inflation rebound. The Fed may need to carefully balance between "fighting inflation" and "preventing recession", and the policy - turning window is narrowing due to external uncertainties [27].

Core Viewpoint - The Federal Reserve's Kashkari indicates that the threshold for FOMC rate cuts remains high, highlighting concerns over tariffs potentially driving U.S. inflation [1] Economic Conditions - Dramatic changes in the economic landscape have been observed as of April 9 [1] - The latest developments may lead to a slight decrease in U.S. inflation [1] - Uncertainty in the economic environment raises the risk of a U.S. recession [1] Employment Market - Numerous companies are reportedly slowing down their hiring activities [1] - Tariffs are expected to impact the U.S. job market negatively while simultaneously increasing inflation [1]

Core Viewpoint - The President of the San Francisco Federal Reserve, Daly, emphasizes that hard data does not misinterpret or misunderstand the growth rate and inflation of the U.S. economy [1] Group 1 - Daly's statement suggests confidence in the reliability of hard economic data in assessing the U.S. economic situation [1] - The focus on hard data indicates a potential shift away from reliance on softer indicators, which may lead to more informed monetary policy decisions [1] - The assertion may influence market expectations regarding future Federal Reserve actions, particularly in relation to interest rates and inflation management [1]

Group 1 - The article discusses the upcoming implementation of "reciprocal tariffs" in the U.S., which is expected to increase inflationary pressures due to the impact on imports [6][10] - It highlights the need to understand how much of the current inflation has already accounted for tariffs and what secondary risks may arise post-implementation [6] - The article also mentions the divergence between PMI and EPMI, indicating a potential disconnect in economic indicators [7] Group 2 - The U.S. will impose a baseline tariff of 10% on global imports starting April 5, with additional tariffs on 60 countries, including specific rates for China (34%), the EU (20%), Vietnam (46%), and others [10] - The article notes that market risk appetite has deteriorated, leading to a rise in gold prices, which reflects investor concerns amid the tariff announcements [8]

Investment Rating - The report maintains a neutral investment rating for the industry, indicating that the expected investment returns will be in line with market benchmarks within the next 6-12 months [27]. Core Insights - The Federal Reserve has decided to pause interest rate cuts for the second consecutive meeting, adjusting inflation forecasts upward while lowering economic growth predictions, which aligns with market expectations [3][5]. - The Fed's Chairman Powell indicated that inflation caused by tariffs is considered temporary, which has significantly eased market concerns, leading to a rise in U.S. stock markets and a decline in bond yields [3][5][11]. - The report anticipates 2-3 potential interest rate cuts within the year, driven by economic pressures and the expected implementation of tax cuts later in the year [3][24]. Summary by Sections FOMC Meeting Insights - The FOMC meeting on March 20 resulted in the decision to maintain the federal funds rate between 4.25% and 4.5%, with the next meeting scheduled for May 7 [2]. - The Fed's statement showed minor changes, reflecting increased uncertainty in the economic outlook and a slower pace of balance sheet reduction [7]. Economic and Inflation Forecasts - The Fed has raised its inflation forecasts while lowering GDP growth expectations for 2025, 2026, and 2027, with GDP growth rates adjusted down by 0.4%, 0.2%, and 0.1 percentage points respectively [8][9]. - The median PCE inflation rate for 2025 is now projected at 2.7%, up from 2.5% in December [9]. Market Reactions - Following the FOMC meeting, major U.S. stock indices saw gains, with the Dow Jones Industrial Average rising by 0.9%, the S&P 500 by 1.1%, and the Nasdaq Composite by 1.4% [4]. - The 10-year Treasury yield fell by 4 basis points to 4.25%, while the 2-year yield decreased by 5 basis points to 3.99% [4]. Economic Health Assessment - Powell described the U.S. economy as "healthy," despite acknowledging an increased risk of recession, attributing recent economic data fluctuations to the initial turbulence of the Trump administration [11][21]. - The report highlights that the impact of tariffs on inflation is expected to be temporary, with significant inflation pressures anticipated to manifest in the upcoming months [11][22].

Investment Rating - The report maintains a neutral stance on the industry, indicating a cautious outlook on future performance [53]. Core Insights - The Federal Reserve has decided to keep interest rates unchanged in the range of 4.25%-4.5% while reducing the monthly limit for Treasury redemptions from $25 billion to $5 billion, maintaining a $35 billion reduction for MBS [3][19]. - Economic forecasts have been adjusted, with the GDP growth rate for 2025 revised down to 1.7%, a decrease of 0.4 percentage points, while inflation predictions for PCE and core PCE have been raised to 2.7% and 2.8% respectively [23][30]. - The market's risk appetite has shown signs of recovery following the Fed's announcement, with significant increases in major stock indices and a decline in 10-year Treasury yields [42]. Summary by Sections 1. Federal Reserve Meeting Highlights - The Fed's statement reflects a stable labor market and acknowledges slight inflation increases, with internal dissent indicating differing views on economic conditions [19][20]. - The Fed's flexibility in lowering interest rates is expected to increase, with potential cuts of 2-3 times in 2025, contingent on economic performance [6][33]. 2. Economic Forecast Adjustments - The Fed has lowered its GDP growth forecast for 2025-2027 and raised its inflation expectations, suggesting that the impact of Trump's policies on inflation may be temporary [23][30]. - The median federal funds rate forecast for 2025 remains at 3.4%, with a potential for a 50 basis point cut [23][30]. 3. Market Reactions - Following the Fed's announcement, the Dow Jones and Nasdaq indices rose by 0.92% and 1.41% respectively, while the 10-year Treasury yield fell below 4.3% [42]. - The dollar index has seen a slight decline, and gold prices have increased, indicating a shift in market sentiment [42].