CICC: If tariffs are further downgraded, the Federal Reserve (FED) may be expected to cut interest rates.

According to Mars Finance news, as reported by Jin10, the China International Capital Corporation (CICC) research report states that if tariffs are further downgraded, the Federal Reserve (FED) may be expected to cut interest rates. Currently, the rise in pressure has not manifested; April's non-farm payrolls remain strong, and the ISM manufacturing and services PMIs also maintain resilience. Even if the Federal Reserve (FED) wants to react preemptively, there is not enough reason to do so, especially considering that Powell's term ends in May next year, which poses a significant risk of overreacting. Therefore, in balancing the "dilemma" between inflation and growth, the Federal Reserve (FED) is more likely to choose to wait and see, rather than taking the initiative. However, if the risk of tariffs can further decrease, the Federal Reserve (FED) will have the opportunity to cut interest rates again in the third and fourth quarters to alleviate growth pressures at that time.