CICC: Wash's statement has already shown a tendency toward interest rate cuts

ME News, on April 22 (UTC+8), a research report from China International Capital Corporation (CICC) said that Kevin Woorh, the Federal Reserve chair nominee, attended a Senate Banking Committee hearing and revealed the core policy arguments of running “balance sheet reduction and rate cuts” in parallel: at the balance-sheet level, he explicitly opposed making quantitative easing (QE) the norm, and advocated a gradual and orderly reduction of the Fed’s balance sheet, exiting fiscal-like responsibilities and returning the focus to monetary policy; at the interest-rate level, although he did not make any explicit commitment, his remarks already showed a tendency toward rate cuts. In our view, Woorh’s policy stance is not only an adjustment to the monetary transmission mechanism, but also an extension of the “America First” strategy in the monetary sphere amid the wave of de-globalization—shifting from a “global central bank” that endlessly supplies liquidity to the world to a new approach that firmly controls the levers of the overall money supply, focuses on domestic productive capacity, and emphasizes monetary sovereignty. We believe this shift means the narrative of persistent dollar liquidity flooding will need to be revised, and assets that rely solely on liquidity-driven growth or benefit from “excessive dollar issuance” may face pressure. (Source: Jin10)
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