Huachuang Securities April Overseas Monthly Observation: Energy Inflation Further Fermentation, Four Major Central Banks Cautiously Weighing Options

Huachuang Securities released a research report stating that since April 2026, the negotiations between the United States and Iran have been slow, and the core differences have not been resolved. However, the market's sensitivity to geopolitical impacts has significantly decreased, risk appetite has been restored, and global stock markets and commodity markets have shown a temporary stability. In a highly uncertain environment where both "inflationary risks" and "economic downturn pressures" coexist, major central banks generally maintain a wait-and-see stance, but do not rule out the possibility of a policy shift towards long-term inflation. In mid-May, Wash was successfully elected as the new chairman of the Federal Reserve, and the transition of office was smooth. Going forward, attention will continue to focus on the US-Iran situation, changes in oil prices, and the reevaluation of the "stagflation" risks by various central banks. Main viewpoints of Huachuang Securities: 1. Overseas Economy: Energy shocks further ferment, major central banks remain cautious Global: Economic growth remains resilient, major central banks adopt cautious monetary policies Economically, global economic resilience has increased in April following a slowdown in March, and the economy remains resilient amid disruptions in the Middle East. In terms of trade, the dry bulk index rebounded rapidly to a new high in April, and South Korea's export growth remained high at 49.4% year-on-year in the first 20 days of April. As for monetary policy, central banks around the world maintain a wait-and-see approach. In terms of fiscal policy, the US has initiated the first phase of tax refunds; the US Treasury has raised its borrowing expectations for the second quarter. Developed economies: Inflationary pressures and economic downturn risks coexist The US economy remains strong, with both manufacturing and services continuing to expand. Non-farm employment growth for the second consecutive month has helped ease downward employment pressure. The rise in energy prices due to the Middle East situation has pushed up overall inflation levels, and the rise in oil prices supports retail through increased gas station consumption, but consumers remain cautious about durable goods consumption. Existing home sales were nearly flat in April, and rising mortgage rates may hamper real estate recovery. Manufacturing economic sentiment in the Eurozone continues to expand, while the service sector has shifted from expansion to contraction. The economic sentiment in the UK and Japan remains in the expansion zone. In terms of inflation, Eurozone, UK, and Japan have all rebounded. 2. Monetary Policy: Most central banks choose to wait and see amid ongoing Middle East conflicts, but hawkish signals strengthen The Federal Reserve continues to maintain a hold, with Powell continuing as a board member after his tenure as chairman ended, restricting room for rate cuts due to inflation rebound. The ECB maintains interest rates unchanged in a highly uncertain environment, with a significantly increased probability of a policy shift driven by inflationary pressures. The Bank of Japan internally releases more hawkish signals for rate hikes, but there are still dissenting views on timing, with a focus on the sustainability of rising inflation. The Bank of England's policy shift signals are clearer, with all three inflation scenarios pointing to rate hikes. 3. Financial Markets: US Treasury yields fluctuate upwards, the US dollar weakens first then stabilizes, and international oil prices fall then rise US Treasuries: Since April, the US Treasury market has been oscillating under the influence of the fluctuating US-Iran negotiations, oil price volatility, inflation concerns, and resilient economic data. The 10-year US Treasury yield has fluctuated upwards nearing 4.5%. As of May 13th, the 2-year US Treasury yield has risen by 19 basis points from the end of March to 3.98%, and the 10-year US Treasury yield has risen by 16 basis points to 4.46%. Exchange Rates: The US dollar index weakens first and then stabilizes; the Japanese yen is relatively weak, and the Bank of Japan intervenes in the forex market; the euro and the pound first rise then stabilize. Oil Prices: Since April, the Middle East geopolitical situation has been the main driver of oil prices, leading to increased volatility in international oil prices. Risk Warnings: Unexpected weakness in the US economy; tightening of financial market liquidity.