CITIC Securities: The Fed's first interest rate cut may be in June

Sina Financial News CITIC Securities Research Report pointed out that the Federal Reserve’s interest rate meeting in March 2024 continued to keep interest rates unchanged, in line with market expectations, and the statement of the interest rate meeting changed little compared with the previous meeting. In terms of economic forecasts, compared with the December 2023 meeting, this meeting has significantly raised the growth forecast for this year and slightly raised the growth forecast for next year, and in terms of inflation forecast, the core inflation forecast for this year has been slightly raised. Powell’s speech was generally neutral, mentioning that this meeting discussed the issue of slowing down and shrinking the balance sheet in the future. We maintain our previous judgment that the Fed’s first interest rate cut may be in June, and this round of interest rate cuts will generally be a gradual rate cut in the “walk-and-see” mode, and the next interest rate meeting may begin to slow down the balance sheet reduction, and the balance sheet reduction will end in the middle of the year to the third quarter. In the short term, we expect the U.S. dollar index and U.S. Treasury interest rates to fluctuate weakly, and U.S. stocks to remain volatile overall.