Global Market Outlook for Next Week: The Fed’s Preferred Inflation Indicator to Be Released …

① Traders expect interest rates to be cut again in October and December, and the Federal Reserve suggests that interest rates will be cut further in the future to support the weak labor market; ③ Next week’s important economic data includes PCE inflation data for August, durable goods orders for August, the final quarterly GDP rate for the second quarter, and the number of jobless claims at the beginning of the week. The market will assess the impact of tariffs on price levels.Financial Services Association, September 21 (Editor: Niu Zhanlin) The Fed’s interest rate cut boosted investors’ optimism. The US stock market closed at a record high this week. They believe the Fed will continue to cut interest rates and drive continued market gains.The S&P 500 index continued to hit a record high on Friday, with a cumulative increase of more than 13% since this year. Traders currently expect to cut interest rates again in October and December, and the Federal Reserve has also hinted that interest rates will be cut further in the future to support the weak labor market.Analyst pointed out that interest rate cuts are expected to benefit interest-sensitive Sector, including small-cap stocks and non-essential consumer goods stocks. If the easing policy translates into lower mortgage interest rates and stronger economic activity, homebuilders’ stocks will also benefit, thereby boosting the sluggish real estate market.Liz Thomas, head of investment strategy at SoFi, said, “The main theme of this week’s market is that we have cut interest rates, and we will also cut interest rates more times. The market is quite satisfied with this, and we are back to the gains driven by interest rate cuts.”Looking ahead to next week, in terms of economic data, what investors are most concerned about is the PCE inflation data for August, which is the Federal Reserve’s favorite inflation Indicators. The market will continue to evaluate whether tariffs are driving up the price level, and if there are signs that the impact is limited, then this will be seen as clearing the way for further interest rate cuts.When first publicly announcing his MMF policy position on Friday, Federal Reserve Governor Steven Milan stressed that the broad tariffs imposed by Trump did not push up Qualcomm, so interest rates should be cut quickly and drastically to prevent the US labor market from deteriorating further.Milan plans to give a speech at the New York Economic Club next Monday to systematically explain its economic views and “explain in detail the logic and calculation process behind the data.”In addition to Milan, other FOMC voting committees will also speak out intensively, which is expected to disrupt global financial markets.Against the backdrop of previous data showing that the US labor market is deteriorating, the market is also closely monitoring whether there will be more signs that economic activity will continue to weaken. Next Thursday will usher in a series of important data: durable goods orders for August, the final quarterly GDP annualized rate for the second quarter, and the number of jobless claims at the beginning of the week. If the data worsens, the “recession trade” may be strengthened.Seth Basham, head of Stocks research at Wedbush, pointed out in a report that since the Federal Reserve emphasizes that the policy path is not a preset, and internal members disagree on interest rate trends, this means that future economic data, especially labor market and inflation data, may cause market fluctuations.In terms of Earnings Reports, only a few companies, such as Micron Technology, Market Opener, and Accenture, deserve attention. Some investors are awaiting the start of fiscal third quarter earnings to assess the impact of tariffs and a slowing job market on US businesses.At the same time, global geopolitical risks continue to heat up, such as signs of conflict between Russia and NATO, Israel’s military operations in the Middle East region, and the fact that the Japanese and French governments are once again in jeopardy, but the market’s pricing of such risks is still limited, and short-term shocks are often offset by liquidity and policy backlogs. But against the backdrop of expensive valuations, optimism may be quickly reversed if energy prices soar or the sovereign bond market is in turmoil.“Geopolitical risk is hardly taken into account in stock prices,” Goldman Sachs strategist Guillaume Jaisson said. “The valuation of US stocks is already at an unusually high level, and the European stock market is by no means cheap. If uncertainty intensifies, we expect the market environment to shift from ‘bad news is good news’ to ‘bad news is bad news’.”An overview of next week’s key events:Monday (September 22): China’s one-year loan market Quote interest rate until September 22, initial Eurozone consumer confidence index value, Australian Federal Reserve Chairman Bullock testified at the House Economic Standing Committee, the State Information Office held a press conference, New York Federal Reserve Chairman Williams delivered a speech on MMF policy and economic prospects, and St. Louis Federal Reserve Chairman Mussalem’s speech on the US economic outlook and MMF policyTuesday (September 23): Eurozone September manufacturing PMI initial value, United Kingdom manufacturing PMI for September, US current account for the second quarter, US preliminary S&P global manufacturing PMI value for September, US September Richmond Federal Reserve manufacturing index, Cleveland Federal Reserve Chairman Hamak delivered a speech on the US economy, Richmond Federal Reserve Chairman Barkin delivered a speech on the economic situation, the Bank of Sweden announced interest rate decisions and MMF policy reports, Hongmeng Zhixing’s fall new product launch, Atlanta Federal Reserve Chairman Bostic delivered a speech on the economic outlookWednesday (September 24): API Crude Oil Product inventory for the week from the US to September 19, Australia’s August weighted CPI annual rate, Germany’s IFO business climate index for September, Swiss Franc September ZEW investor confidence index, total annualization of new home sales in the US in August, EIA Crude Oil Product inventory for the week from the US to September 19, EIA Global Strategy petroleum reserve inventory for the week from the US to September 19, and Bank of Canada Governor Maclum delivered a speechThursday (September 25): Germany’s October Gfk consumer confidence index, Swiss Franc’s central bank policy interest rate, US unemployment claims until September 20, final US real GDP annualized quarterly rate for the second quarter, monthly US durable goods order rate in August, total annualized annual home sales in August, final value of the US core PCE price index annualized quarterly rate for