Core Viewpoint - The Federal Reserve is expected to restart interest rate cuts during its upcoming meeting, with market speculation on whether the cut will be 25 or 50 basis points, driven by signs of a cooling job market and a significant downward revision of non-farm employment data [1][2]. Group 1: Federal Reserve and Interest Rates - The Federal Reserve's anticipated rate cut is influenced by a downward revision of 911,000 non-farm jobs over the past year, indicating previous employment growth was overestimated [1]. - The current federal funds rate is approximately 4.33%, following a cumulative cut of 100 basis points, with the Fed having raised rates 11 times since 2022, totaling 525 basis points [4][7]. - As the Fed's rate cut expectations rise, the U.S. dollar weakens, leading to strong performances in both the stock and bond markets, with the 10-year Treasury yield falling to around 4% [1]. Group 2: Bond Market Performance - From January to August 2023, various bond indices showed positive performance, with the U.S. comprehensive bond index up 4.99%, U.S. Treasury index up 4.48%, investment-grade corporate bond index up 5.30%, and high-yield bond index up 6.35% [2]. - The 10-year Treasury yield fluctuated between 4.2% and 4.5% during July and August, with market concerns about a potential economic recession driving rate cut expectations [2]. Group 3: Investment Opportunities - The current high interest rates make U.S. dollar money market funds attractive, with the market size around $7.2 trillion, although yields are expected to decline as the Fed cuts rates [4][8]. - For U.S. Treasury bonds, short-term rates are likely to decrease with rising cut probabilities, while long-term rates may experience upward pressure due to fiscal policies and inflation expectations [9]. - U.S. credit bonds offer yield advantages and potential capital gains during rate cuts, but caution is advised regarding low-quality high-yield bonds and credit risk management [10].