CICC: The Fed will not cut interest rates preemptively.

The research report from Zhongjin Company stated that the Federal Reserve's May meeting staying put was in line with market expectations. The monetary policy statement pointed out that the risks of rising unemployment and increasing inflation have intensified, implying that the policy environment faces the risk of "stagflation." However, due to the current stable economic data, the Federal Reserve is not in a hurry to take action. Zhongjin Company believes that the Federal Reserve will not cut interest rates in the short term, especially not preemptively. The future rate cut path will depend on the tariff negotiations: if there is no substantial progress in the negotiations and tariffs remain high, the Federal Reserve may be forced to start a "recession-style" rate cut, cutting rates by 100 basis points before the end of the year; but if the negotiations achieve effective results and tariffs are reduced, the Federal Reserve may postpone the rate cut until December, and the rate cut will also be more moderate.