Guotai Junan comments on the Fed's June interest rate meeting: suspension of interest rate hikes but not over

Xinhua News Agency, June 15, Guotai Junan believes that the Federal Reserve kept interest rates unchanged in June and retained a window for subsequent interest rate increases. SEP raised its forecast for the median interest rate at the end of the year to 5.6%, corresponding to two interest rate hikes, upward revision of core inflation and economic growth, and downgraded unemployment forecasts to reflect trends after recent banking events have watered down the impact. Combined with the fact that the policy tightening effect is not yet fully apparent and the economic momentum is still weakening, it is still possible for the Fed to continue to suspend interest rate increases in the future, but there is little room for interest rate cuts. The recent high of US stocks is mainly due to the contribution of valuation. There is still short-term resilience, medium-and long-term profit pressure is still there, economic-related varieties are weak, and AI technology trends related to the sector continues to differentiate. Under the revision of the expected increase in interest rates on US debt, the yield on US debt may fluctuate at 3.5% in the short term and 4.0% in the short term, and is expected to fall below 3% to 3.5% in the medium term. Gold continues to be under pressure in the short term due to the rapid rise in US dollar and US bond yields, and fears of a medium-term recession and a shift in Fed policy are expected to hold steady at $2000 an ounce.