Last week, central banks in Canada and Switzerland cut rates successively, and this week will welcome the "Super Central Bank Week," with 25 central banks, led by the Federal Reserve, the Bank of Japan, the Bank of England, and the Central Bank of Russia, meeting in the same week, accounting for more than 40% of the global economy.

It is particularly noteworthy that global monetary policy is increasingly unbalanced amid intense geopolitical turmoil, with the Federal Reserve expected to cut rates, the Bank of England still hesitating, and the Bank of Japan and the Central Bank of Russia possibly raising rates this month or next.

The interest rate decisions and information released by these central banks may become catalysts for the global financial market's year-end trends and may "leak" the direction and path of market trends in 2025. Especially in the foreign exchange and commodity markets, price fluctuations may turn into severe storms within hours following the announcement of key central bank decisions.

The "great show" between the Federal Reserve and Trump is about to begin.

The Federal Reserve is certainly the most watched entity in the "last Super Central Bank Week of 2024." In the early hours of Thursday, Beijing time, the Federal Reserve will announce its December interest rate decision.

Following the release of the expected U.S. CPI data for November, the market anticipates that the likelihood of a 25 basis point rate cut by the Federal Reserve is close to 100%. However, investors are concerned that the data has not yet reached the 2% long-term inflation target, along with the impending tariff war, the expulsion of illegal immigrants, tax cuts, and deregulation after Trump takes office next year, which could accelerate inflation rebound, posing significant uncertainty for the U.S. economy. Will the Federal Reserve pause rate cuts next year?

Therefore, the Federal Reserve's post-meeting statement, Chairman Powell's speech, and the latest dot plot forecast will be exceptionally important. The reactions of Trump and incoming Treasury Secretary Basant are also crucial. Will the core of the dollar and the core of U.S. political power continue to "renew their relationship," continue to undermine each other, with endless schemes, competing for tremendous and vital power and interests?

Goldman Sachs has revised its forecast in advance, believing that the Federal Reserve will not continue to cut rates in January but maintains the inference that the Fed will cut rates in March, June, and September. Who is Goldman betting will win?

The Bank of England may choose to remain inactive.

Last Friday, the UK's Office for National Statistics released data showing that the UK's GDP shrank by 0.1% month-on-month in October, falling short of the expected growth of 0.1%, marking the second consecutive month of contraction and the first occurrence of economic decline since 2020.

Under immense pressure, the British government could not hold on any longer, and there were reports that it would reduce its criticism of China in the review of China-UK relations and supply chains to help Prime Minister Stamer develop economic relations with China.

However, in the choice between the UK economy or the pound, the market generally expects that the Bank of England will choose to remain inactive, using the Federal Reserve's rate cuts to raise the exchange rate, countering Stamer's proposed £40 billion tax increase plan and £100 billion investment plan, to avoid potential inflation rebound. Some experts believe that the Bank of England is controlling the pace of rate cuts mainly because the European economy is performing worse, with worse growth expectations.

Will the Bank of Japan once again surprise the global market?

The yen has fallen against the dollar for seven consecutive days, breaking through the 154 level.

Although the market believes the likelihood of the Bank of Japan raising rates this week is less than 20%, considering that the Japanese government recently raised the third-quarter economic growth data, clearing the obstacles to rate hikes, and the Bank of Japan's preference for "surprises," who dares to let their guard down?

This summer, amid heart rate irregularities and angina (liquidity issues) at the heart of the dollar, the Bank of Japan suddenly raised interest rates, triggering a global market explosion. The wave of deleveraging in yen arbitrage trades surged uncontrollably, and global stock markets evaporated about $6.4 trillion in three weeks, with the Nikkei 225 index experiencing its largest drop since 1987.

The current situation is somewhat similar. On December 3, according to Bloomberg's analysis of data from the Japan Financial Futures Association, the Tokyo Financial Exchange, and the U.S. Commodity Futures Trading Commission, Japanese retail investors, leveraged funds, and foreign asset management companies increased their bets against the yen in November to $13.5 billion, far exceeding October's $9.74 billion, reaching 62.5% of the July peak of $21.6 billion. Bloomberg predicts that short positions against the yen are still rapidly rising, indicating that yen arbitrage trading is "reviving."

If the Bank of Japan raises interest rates, will it once again surprise the global market?

Regardless of the outcome, the post-meeting press conference by Bank of Japan Governor Ueda Kazuo will attract keen interest from market participants.

Because it concerns the Bank of Japan's monetary policy meeting on January 24. That is the fourth day of Trump's inauguration as President of the United States, whether the Bank of Japan can respond correctly to Trump's new policies will become a new suspense.

The Bank of Japan suddenly announced that its Vice Governor Yoshio Ito will give a speech to local business leaders in Yokohama on January 14 next year, followed by a press conference. The media pointed out that this move by the Bank of Japan is unusual because, in the past decade, members of the Bank of Japan's policy board have not held such activities before the first policy meeting of the new year.

Declining China-Russia trade and soaring Russian inflation.

In October of this year, the Central Bank of Russia announced an interest rate hike of 200 basis points, raising the benchmark rate from 19% to a historic high of 21%. At that time, the Central Bank of Russia warned that inflation was "significantly higher" than its summer forecast, and inflation expectations would continue to rise. The central bank also stated that "domestic demand growth has significantly exceeded the capacity to expand the supply of goods and services."

In November, the consumer price index in Russia rose by 8.9% year-on-year, higher than the 8.5% in October, mainly driven by rising food prices. This means that basic food items such as butter, eggs, sunflower oil, and vegetables are still increasing in price.

The reasons for the rebound in Russian inflation are not complicated.

First, the labor and supply shortages caused by the Russia-Ukraine war, along with families in remote impoverished areas obtaining substantial additional income due to the war, have increased demand, changing the supply and demand dynamics.

Secondly, after the United States imposed a series of new sanctions on Russia, it affected China-Russia trade. On December 4, Putin stated that the main challenge in Russia-China trade is the payment settlement issue, and the central banks of both countries are working to solve this problem.

On December 10, China's customs released a report showing that China's exports to Russia denominated in RMB fell by 10.5% in November, while there was a 24% increase in the previous month. Reuters pointed out that this was the first decline in four months. At the same time, imports from Russia to China were also not optimistic, with a decline of 7.4% in November, bringing the bilateral trade volume to only 145.9 billion yuan (equivalent to 20.14 billion dollars), a decrease of 5% from October overall.

There are even voices suggesting that China-Russia trade and economic relations have reached a turning point.

In the early morning of December 11, Dmitry Medvedev, Vice Chairman of the Russian Security Council, arrived in China for a two-day working visit. Medvedev stated, "During discussions with Chinese partners, we talked about the Ukraine issue, the Syrian crisis, and the unilateral economic restrictions imposed bypassing the United Nations Security Council."

Trade with Russia is also testing China's financial capabilities.

Thirdly, the further weakening of the ruble has exacerbated Russian inflation, raising import costs.

Economists now expect that the Central Bank of Russia will raise interest rates by 200 basis points at the meeting on December 20, further increasing the country's key rate to 23%.

A senior emerging markets economist at Capital Economics stated that Russia is "losing the battle against inflation," with prices continuing to rise, and by the end of 2025, the inflation rate could be "significantly higher" than 9.0%.

What impact will the Federal Reserve's rate cuts have on the financial markets?

Will the Bank of Japan once again surprise the global market?

Can the Central Bank of Russia's interest rate hike curb inflation?

This Saturday (December 21) at 9 PM, Hong Academy's micro-class will discuss (Will the Federal Reserve lead, and will Super Central Bank Week tear apart the global market?). The "great show" between the Federal Reserve and Trump is about to begin, who will falter first, the UK economy or the pound, the yen arbitrage trade is "reviving," will the Bank of Japan's interest rate hike cause ripples again, can the Central Bank of Russia suppress inflation, and how will financial markets around the world respond? This is a great opportunity for investors to observe the direction of monetary financial trends, and everyone is welcome to participate actively! #比特币冲向11万？