CICC's report is quite harsh; if interest rates are not cut this year, they will have to shrink the balance sheet first, and liquidity assets will come under pressure.

Jiejie.com news: A CICC research report indicates that current U.S. inflation is mainly driven by structural factors such as energy shocks. Cyclical inflation is not yet evident, but investors should be cautious about the risk of a rebound in total demand stemming from an expansion in AI capital expenditures and improvements in employment. CICC maintains its baseline view that the Federal Reserve will not cut or raise interest rates within the year. It expects the Fed’s stance to remain hawkish. After Wosh takes office, its top priority will be to rebuild policy credibility, which may be demonstrated by reinforcing expectations of balance-sheet reduction rather than by signaling rate hikes. A “balance-sheet reduction first, rate cut delayed” scenario cannot be ruled out, which would continue to weigh on assets that rely on liquidity-driven growth.