A happy result of raising interest rates: the worst period of QT may has passed

程俊Dream
2022-07-28

In July, the Federal Reserve decided to raise interest rates by 75 basis points.

Powell's wording about slowing down the pace of interest rate hikes was interpreted by the market as a positive factor, helping major assets to continue their recent rebound momentum.

From the interest rate side, there is no more room for this year or even next year, but the crux of the future may not only lie in monetary policy.

Unlike one person who opposed raising interest rates by 75 basis points in June, all Fed policy makers agreed to increase interest rates by 75 basis points this time.Federal Reserve Chairman Powell stressed the importance of a strong labor market and lowering inflation, and "will not hesitate to take greater actions when necessary".

However, he also released doves' signals, saying that another unusually large interest rate increase depends on the data, and it is appropriate to slow down the pace of interest rate increase at some point.

Although the CPI was spoiled in May, the current policy trend is consistent with previous speculation: FOMC in June and July is the biggest test, and the remaining space for raising interest rates in 2022 will be squeezed . The worst moments of austerity are history.

From the perspective of asset feedback, there is no difference in the varieties that rebounded overnight, and there is no reverse first "fake action".

The weekly adjustment trend of the core indicator, the US dollar index, continued to help risky assets rebound in by going up one flight of stairs. The yield of 10-year US bonds with the highest correlation with interest rate is close to the bottom margin. If 2.7 falls, it will mean that the market-denominated interest rate prospect is more significant.


In terms of major assets, S&P has a steady trend and returned to 4000 level. However, it is expected that the real challenge will appear in the range of 4100/4200. Oil prices continued to hold the support around 93, but this week's overall performance was tepid, which can only be said to match the trend of risky assets.

Gold was also revised after ensuring the effectiveness of last year's low level, and the current downward pressure has eased. However, the discussion of returning to the bull market or rebuilding the long position may need clearer signals to confirm.

With the landing of boots and the coming of a short "empty window" of the Federal Reserve, in the next month or two, besides paying attention to inflation and other data, we should also pay attention to news changes other than other economic data.

After the last two FOMCs, there have been many topics about the risk of recession in the United States, but the main starting point comes from raising interest rates too fast and too hard. However, according to past experience, unexpected changes may make the market most unprepared. For example, the evolution of the situation in Europe, such as the subtle changes in Sino-US relations, may become a new focus.

Strategically, the whole August may still belong to the era of rebound, but don't understand rebound as reversal. Don't be too greedy after a wave of eating. The long-term bull characteristics of the US dollar are not over, and the good days of risky assets are naturally difficult to last long.

If the dollar correction is sufficient, proper allocation of dollars is still a recommended option. At the same time, we continue to pay attention to the linkage performance between oil prices and US stocks-US oil falling below 92/93 should be regarded as a signal that the market rebound is over.

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Comments

  • Blueberryoh
    2022-07-29
    Blueberryoh
    美国经济连续两季萎缩,投资人预期美联储将提早结束本轮升息周期,美股周四 (28 日) 震荡走高,债券殖利率下滑,防御性类股领涨,三大指数收盘齐扬,纳斯达克指数收涨1.08%,创下2020年4月以来最大升幅。
  • Derrickola
    2022-07-29
    Derrickola
    enjoy while it last I can only say [smile]
  • yunsy
    2022-07-29
    yunsy
    Thanks for sharing!
  • Gcwj
    2022-07-29
    Gcwj
    Interest
  • Ph2046
    2022-07-29
    Ph2046
    Unstable situation!!
  • PC711
    2022-07-29
    PC711
    great to hear that 😊
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