Federal Reserve's Daly: We are in the early stages of AI potentially driving exponential growth in productivity.
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Federal Reserve Bank of Canada President Daly emphasized that the dual mandate objectives remain unchanged, but expressed a willingness to assess the economy using new methods.
Odaily Odaily reports that Federal Reserve Bank of Canada President Tom Daly stated that inflation should begin to slow, but the economic outlook remains highly uncertain. Speaking at a Spanish central bank event in Santander on Thursday, Daly said, "We continue to maintain a slightly restrictive policy level, so inflation should decline." Daly noted that tariffs and rising oil prices this spring, following the US-led war with Iran, pushed up inflation. She praised the slowdown in oil prices following the ceasefire agreement between the US and Iran, saying it brought "hope for easing," but warned that it remains unclear how the economy will evolve. She outlined several scenarios that might require different responses from the Federal Reserve, and suggested that the Fed may need to take a more aggressive approach to persistent inflation. Daly also pointed out that she is open to using different and novel methods to assess the economy, but for the credibility of the Federal Reserve, it is important not to change its mission of promoting full employment and price stability. (Jinshi)
Daly: The Federal Reserve may need to continue fighting inflation.
According to Mars Finance, as reported by Jinshi, Federal Reserve Chairman Daly stated that there is a scenario in which the Federal Reserve may have to continue fighting inflation.
Trump stated that Warsh "must do what he has to do" and will continue to push for the dismissal of Federal Reserve Governor Cook.
According to Mars Finance, on July 3rd, following the release of the US June non-farm payroll report last night, US President Trump gave an interview and refused to offer advice to Federal Reserve Chairman Warsh, stating that the new chairman "must do what he has to do." Trump indicated that Warsh has a potentially hostile board, and unfortunately, this board may be trying to do the wrong things. Trump also stated that he will continue to push for the dismissal of Federal Reserve Governor Cook by "winning the lawsuit."
A Wall Street veteran says the continuation of the US stock market bull run depends on the Federal Reserve's policy stance, with very little room for error.
According to Mars Finance, on July 2nd, Bob Doll, CEO of Crossmark Global Investments, stated that the current US stock market is in a "high-risk bull market." With inflation consistently above the 2% target, for the market to continue its upward trend, two conditions must be met simultaneously: continued better-than-expected corporate earnings and the Federal Reserve maintaining a neutral or even accommodative policy. Doll pointed out that although oil prices have recently fallen, US inflation remains above the target level, and the current rate-cutting cycle may be nearing its end, with the possibility of another rate hike this year not ruled out. With valuations at historically high levels, the market's reliance on earnings and policy has significantly increased, resulting in a lower overall margin for error. FactSet data shows that institutional consensus expects the S&P 500 to rise approximately 21.2% over the next 12 months, with a target of around 8918 points. Second-quarter earnings growth is projected at 23.1%, potentially maintaining growth above 20% for two consecutive quarters. The current forward P/E ratio is approximately 20.1, slightly higher than the five-year average. Regarding monetary policy, the market is largely focused on the latest remarks from Federal Reserve Chairman Kevin Warsh. He did not provide clear guidance on whether there would be a rate hike in July, reiterating that the Fed will weaken forward guidance, emphasize reliance on economic data, and maintain its goal of keeping inflation back at 2%. His speech caused the yield on the two-year US Treasury note to fall to approximately 4.15%, cooling market bets on a rate hike this year. However, overall expectations still suggest a possible rate hike in 2026, while the baseline scenario favors maintaining interest rates unchanged until 2027.
Swiss private bank Julius Baer: The Federal Reserve is unlikely to raise interest rates, and gold prices are expected to rebound.
According to Mars Finance, citing Jinshi, Swiss private bank Julius Baer predicts that the Federal Reserve is unlikely to raise interest rates and the dollar may weaken, thus gold prices are expected to recover lost ground.
The probability of the Federal Reserve keeping interest rates unchanged in July is 73.3%, and the probability of a rate hike in September is 52.7%.
According to ChainCatcher, citing Jinshi, CME's "FedWatch" shows that the probability of the Federal Reserve keeping interest rates unchanged in July is 73.3%, and the probability of a cumulative 25 basis point rate hike is 26.7%. By September, the probability of keeping interest rates unchanged is 32.4%, the probability of a cumulative 25 basis point rate hike is 52.7%, and the probability of a cumulative 50 basis point rate hike is 14.9%.