Huachuang Securities: US CPI is likely to peak year-on-year, and the Federal Reserve may maintain interest rates.

Huachuang Securities released a research report stating that in May, the US CPI continued to rise beyond 4%, and it is expected that May will likely be the high point of this round of year-on-year US CPI. For the Federal Reserve, given that there are no signs of overheating in the job market and the economic K-shaped differentiation has not converged, inflation may peak and fall back. As long as there is no risk of long-term inflation expectations derailing, the bank still believes that the current threshold for raising interest rates is relatively high, tending towards the Fed maintaining rates unchanged this year. For US stocks, if the probability of a rate hike is low, the downside risk of macro-policy tightening will be minimized, leaving only the self-deduction of industry trends; for US bonds, short-term interest rates are mainly influenced by expectations of policy rates, with the current 2-year US bond rate at about 4.1%, if there is no rate hike, the likelihood of a decline could be greater.