Zhongjin: The engine driving the expansion of US dollar liquidity is undergoing a "big switch".

Zhongjin pointed out that the engine driving the expansion of the US dollar liquidity is undergoing a "major switch". With inflation transitioning from lurking to emerging and the new Federal Reserve chairman, Powell, advocating for balance sheet reduction, the era of externally driven currency post-pandemic by the Federal Reserve's balance sheet expansion and fiscal deficit may be coming to an end. Meanwhile, internally driven currency expansion through AI capital expenditures has taken shape - the engine of liquidity is shifting from the policy end to the real economy. Internal currency expansion will not only enhance economic resilience and deepen inflation stickiness, but also drive funds from traditional real estate and consumer sectors to the technology frontier with higher return expectations. In the future, asset performance may continue to differentiate: assets relying solely on externally driven liquidity will face pressure, while assets representing advanced productivity are expected to thrive in the expansion of internal currency.