Golden Finance: Risk of Interest Rate Increase Greater than Risk of Decrease After Trump's Election

BlockBeats News, November 8th. A research report by CICC pointed out that by mid-2025, US inflation and economic data may gradually warm up, the pace of interest rate cuts may gradually stop, and with Trump's reelection, the risk of interest rate hikes is greater than the risk of cuts, with a 100bps cut being an appropriate magnitude.

The market's expectations for the future interest rate cut path have once again swung from one extreme to the other, particularly influenced by recent economic data and the post-election expectations. Looking at the pace, inflation and economic data may gradually rise by mid-2025, leading to a gradual halt in interest rate cuts.

CICC estimates that inflation in the fourth quarter of this year will show a tailwind effect due to base effects, but with the downward pressure on rent, both inflation and core inflation will ease by the first quarter of 2025. In terms of magnitude, a cut to around 3.5% is a reasonable level.