Institutions: High inflation supports the Fed's cautious stance; markets will closely watch Powell for signs of easing

Glonghui, January 28th｜Christian Hantel, Head of Global Corporate Bonds at Vontobel Switzerland, stated that the current outlook for the US economy remains optimistic, with continued economic growth and a labor market that, while slightly weak, has stabilized. The inflation rate is still above the Federal Reserve's target level, which means there is insufficient basis for a rate cut in the near term. Investors should shift their focus to the FOMC meetings in March and June, viewing them as potential windows for policy adjustments. However, if economic conditions require, these adjustments could also be postponed to the second half of 2026. The market will closely monitor any signals from Federal Reserve Chairman Powell regarding the Fed's openness to further easing policies. But for now, the Fed's cautious approach and decision-making on a meeting-by-meeting basis seem likely to continue.