Zhongjing: The US economy is facing "stagflation"

A research report from Zhongjin Company points out that the current US economy is entering a "high" era - tariffs and interest rates are expected to remain high for a long period of time. We believe that this combination will bring "stagflation" pressure: from the perspective of "stagnation", tariffs are essentially a form of taxation, which will increase the cost of imported goods and burden American businesses and consumers. If businesses bear the cost of tariffs, it will lead to a decrease in profits, weaken investment and hiring intentions; if consumers bear the cost, it will weaken purchasing power and suppress consumer spending. Regardless of who bears the cost, the ultimate result is to suppress total demand. At the same time, the Federal Reserve, being concerned about inflation, has been slow to cut interest rates, leading to high interest rates and suppressing interest-sensitive industries, especially the real estate sector. This will increase the pressure on the slowdown of US growth, and the labor market will also come under pressure.