Golden Finance reported that Barclays said that we now expect the Federal Reserve FOMC to cut interest rates three times this year, in September, November and December, by 25 basis points each time. We assume that the labor market will show continued resilience in the August report and the unemployment rate will stop rising. Based on this assumption, we currently believe that a 50 basis point rate cut in September is unreasonable. However, if the unemployment rate rises further, it will raise concerns that the labor market is cooling faster than expected. Looking ahead to 2025, we expect the unemployment rate to gradually fall to 4.2%, and the inflation forecast will remain unchanged. We continue to expect the FOMC to cut interest rates three times in March, June and September next year, and expect that concerns about the lack of further progress in inflation in the second half of 2025 will cause the FOMC to pause its interest rate cuts after the federal funds rate range reaches 3.75-4.00%. In the long run, we continue to believe that the neutral interest rate level is around 3.00-3.25%.
