According to the Dongwu Securities Research Report, the remaining inflation data for the third quarter of 2026 is expected to continue the cooling trend, and interest rate hikes are expected to leave room for recovery; US inflation is expected to return below 2% in the second quarter of 2027. Currently, trader pricing will continue to decline moderately in the year-on-year growth rate of US CPI from August to October, bottoming out at the bottom of the 2.94% period in October. Looking at the long term, under the benchmark assumption that oil prices are stable, the average US CPI is expected to fluctuate around 3.2% year-on-year from August this year to February next year, still due to the pulse of rising oil prices. However, the year-on-year growth rate of the US CPI from March to May next year is expected to decline significantly due to the high base effect caused by the end of the oil price pulse, falling to 2.56%, 2.03%, and 1.71%, respectively. Therefore, as long as there is no significant upward risk in oil prices, the Federal Reserve will no longer need to raise interest rates starting in the second quarter of 2027. In terms of strategy, as of the latest, traders are expecting 1.04 and 1.65 interest rate hikes in December this year and June next year, respectively. Although this is down from 1.48 and 2.2 at the end of July, there is still room for compression. Dongwu Securities maintains the view that the Federal Reserve will not raise interest rates this year. The current implied rate hike of 26 bps for the whole year is expected to return, corresponding to the weakening of the 2-year US Treasury interest rate and the US dollar index, and the rise in gold.

According to the Dongwu Securities Research Report, the remaining inflation data for the third quarter of 2026 is expected to continue the cooling trend, and interest rate hikes are expected to leave room for recovery; US inflation is expected to return below 2% in the second quarter of 2027. Currently, trader pricing will continue to decline moderately in the year-on-year growth rate of US CPI from August to October, bottoming out at the bottom of the 2.94% period in October. Looking at the long term, under the benchmark assumption that oil prices are stable, the average US CPI is expected to fluctuate around 3.2% year-on-year from August this year to February next year, still due to the pulse of rising oil prices. However, the year-on-year growth rate of the US CPI from March to May next year is expected to decline significantly due to the high base effect caused by the end of the oil price pulse, falling to 2.56%, 2.03%, and 1.71%, respectively. Therefore, as long as there is no significant upward risk in oil prices, the Federal Reserve will no longer need to raise interest rates starting in the second quarter of 2027. In terms of strategy, as of the latest, traders are expecting 1.04 and 1.65 interest rate hikes in December this year and June next year, respectively. Although this is down from 1.48 and 2.2 at the end of July, there is still room for compression. Dongwu Securities maintains the view that the Federal Reserve will not raise interest rates this year. The current implied rate hike of 26 bps for the whole year is expected to return, corresponding to the weakening of the 2-year US Treasury interest rate and the US dollar index, and the rise in gold.