Dongwu Securities: In July, the U.S. non-farm payrolls unexpectedly turned negative, and the expectations for interest rate hikes still have significant room for cooling.

Dongwu Securities released a research report stating that the U.S. added non-farm jobs unexpectedly turned negative in July. Looking ahead, as the short-term impulses from fiscal measures and the World Cup gradually recede, along with the delayed effects of tightening financial conditions becoming apparent, the U.S. economy may experience a phase of cooling in Q3 2026. The firm expects that the upcoming important data, including the July CPI, August CPI, and non-farm payrolls as well as the annual adjustments to non-farm figures, will continue to weaken expectations for further rate hikes by the Federal Reserve, leading to a decline in U.S. Treasury rates and the dollar index, while providing support for gold prices.