US Fed Vice Chairman Jefferson expressed "cautious optimism" regarding the US economic outlook, suggesting that, driven by robust productivity growth, inflation is expected to pull back to the central bank's 2% target level. Additionally, Jefferson noted that the current policy stance is sufficient to effectively address economic developments.

【SMM Steel】IDOM won the FEED phase for HADEED's Flat Products Expansion Project in Jubail. The project aims to boost capacity and logistics. It shows HADEED's commitment to meeting growing demand for premium flat steel. IDOM will use advanced tech to improve efficiency and supply chain reliability. The expansion will enhance productivity and flexibility using Jubail's infrastructure.

Data from the National Energy Administration shows that in 2025, China's total electricity consumption historically exceeded 10 trillion kWh, reaching 10.4 trillion kWh, up 5% YoY. This figure set a record for electricity consumption by a single country globally, equivalent to more than twice the annual electricity consumption of the US and exceeding the combined annual electricity consumption of the EU, Russia, India, and Japan.

Speira has commissioned “Bernhard,” the first of four modernised aluminium-recycling furnaces, as part of an €11 million programme at its Grevenbroich plant. The tiltable rotary unit, chosen and named by employees in memory of a late colleague, holds up to 25 tonnes and is designed to process difficult “low-grade” scrap and dross. Two additional furnaces will be installed at Töging and a second at Grevenbroich, entering service in October 2025, May 2026 and October 2026 respectively. The new equipment—complete with automatic chargers, advanced burners, suction hoods and thermal afterburners—raises productivity while cutting CO₂ emissions and is future-ready for hydrogen fuel. Easier maintenance, enclosed metal tapping and reduced vehicle traffic enhance workplace safety. CEO Einar Glomnes highlighted the move as part of Speira’s commitment to a circular economy, while local officials welcomed the investment for safeguarding jobs in the Rhineland region.

On June 10, FAW Toyota officially put its all-new mid-size electric SUV, the bZ5, onto the market, unveiling four initial variants: the 550 JOY, the 550 PRO, the 550 PRO Smart Drive, and the 630 PRO, ...

The 11th China (Shanghai) International Technology Fair (CSITF), with the theme of "Open Cooperation: Empowering New Quality Productive Forces and Sustainable Development," opened yesterday (June 11) at the Expo Exhibition Center. Shanghai Mayor Gong Zheng attended and launched the fair.

Last Friday, Eastern Time, the latest non-farm payrolls report released by the US Bureau of Labor Statistics brought relief to Wall Street. The report showed that the seasonally adjusted non-farm payrolls in the US in May reached 139,000. Although this marked the lowest level since February, it was still higher than the market expectation of 130,000. Meanwhile, the US unemployment rate remained at 4.2% for the third consecutive month, which also eased concerns that the labour market was beginning to slow down significantly. However, US economists warned that the impact of Trump's tariffs on US employment may not truly manifest until July or August. Therefore, it may be too early for Wall Street and the US Fed to let their guard down. It's too early to relax now. As early as last Thursday, Eastern Time, Joe Brusuelas, chief economist at RSM, wrote in his report: "We believe it is too early for the (May non-farm) employment report to reflect the negative impact of trade policies. This impact will only be fully reflected in the employment reports for July and August ." Although US President Trump announced global tariff policies as early as on "Liberation Day" (April 2), due to the frequent changes in Trump's trade policies and the delays caused by economic transmission, the far-reaching impact of tariffs on the US economy and job market may not be fully felt until midsummer. Joe Brusuelas also stated that the current US job market has already shown an overall cooling trend, initially reflecting the impact of tariffs. US business owners may be waiting and seeing. In fact, "resilience" was once a key word for the US economy during the COVID-19 pandemic. This characteristic also applies in the current phase of trade conflicts. Similar to the COVID-19 period, the current US economy shows a trend of maintaining low layoff rates and stable business activity. However, with the implementation of tariffs, economic data for May has already begun to show signs of a slowdown in US hiring and manufacturing output data. Although Wall Street analysts expect the US labour market not to collapse, the labour market may also increasingly exhibit a state of "hesitation" and "stagnation" —because business employers are increasingly realizing that the best strategy in this period of uncertainty is to wait and see—that is, neither to lay off employees on a large scale nor to increase hiring. This trend has also been clearly reflected in the non-farm payrolls data: although the unemployment rate has not surged significantly, the growth in non-farm payrolls has declined month by month. This is actually not good news for the US economy—although the labour market will not collapse, the prolonged hiring freeze by companies will also have a negative impact on the economy. "We are approaching an inflection point, and concerns about stagflation may penetrate into a broader market level," said Chris Zaccarelli, Chief Investment Officer of Northlight Asset Management. "We are seeing a decline in productivity, a slowdown in economic growth, and at the same time, signs of rising (or sticky) inflation."

From June 4 to 5, Huatai Securities' 2025 Mid-Year Investment Summit was held in Shanghai. Themed "Seeking Certainty Amidst Order Reconstruction," the summit delved into the new logic of global order reconstruction and the revaluation of Chinese assets. The two-day event comprised a main forum and 11 industry sub-forums, focusing on growth opportunities in sectors such as New Consumption 2, AI+, humanoid robots, and energy transition. Nearly 500 publicly listed firms were invited to participate in closed-door exchanges, attracting over 2,500 professional investors and institutional clients from public funds, private funds, banks, insurance companies, and publicly listed firms to register for the event. Notably, the summit featured a special "China + Southeast Asia" sub-forum, exploring industrial breakthrough strategies and capital empowerment pathways amidst the reconstruction of trade order from an international perspective. Experts such as Liu Yuanchun, President of Shanghai University of Finance and Economics, former Vice President of Renmin University of China, and co-founder of the China Macroeconomic Forum (CMF); Wu Xinbo, Dean of the Institute of International Studies at Fudan University, Director of the Fudan University US Research Center (a key humanities and social sciences research base under the Ministry of Education), and member of the Foreign Ministry's Foreign Policy Advisory Committee; Wei Shaojun, Professor at Tsinghua University, member of the National Advisory Committee for the Development of the Integrated Circuit Industry, Vice Chairman of the China Semiconductor Industry Association, and Chairman of the China JSTC of the World Semiconductor Council; and Siregar, Chief Economist of Indonesia's sovereign wealth fund Danantara, delivered keynote speeches on hot topics such as AI technological development, new logic in China's economy, and new policy approaches. Exploring Certainty Opportunities Amidst Order Reconstruction in the Macro Context In her opening remarks, Liang Hong, Chair of Huatai Securities' Institutional Business Committee, stated that in the face of prolonged trade conflicts, investors are eager to see how China will formulate new economic development strategies, promote broader and deeper economic reforms, and thereby increase residents' incomes and consumption willingness, as part of their expectations for the "15th Five-Year Plan." Liang Hong suggested that investors should adopt a longer-term perspective to explore certainty opportunities amidst order reconstruction within macro contexts such as global order reconstruction, supply chain reorganization, and new directions in capital flows. This also represents the core logic for global investors to reevaluate the value of the RMB and RMB-denominated assets, particularly in China's competitive industries and high-quality enterprises. The Huatai Research Macro Team conducted a roundtable discussion on current macroeconomic and market concerns. Maintaining the Forecast of 5% Real GDP Growth in 2025 Amidst external disruptions, Huatai Securities' Macro Team maintains its forecast of 5% real GDP growth for this year. What policy and external environment assumptions underpin this forecast?What is the logical basis for the expectation of RMB appreciation? Yi Huan, Chief Macroeconomist at Huatai Securities, stated that since April, the US tariff policy has been full of twists and turns, with uncertainties still remaining. However, on the whole, the impact of tariffs is relatively small compared to expectations at the end of last year. Domestically, China's macro policies have shown notable highlights. The growth in fiscal expenditure for the entire year is expected to exceed the nominal GDP growth rate, surpassing market expectations. The accelerated development of the technology cycle, with new quality productive forces such as AI+ emerging as new highlights, has also alleviated the drag on the economy from the downturn in the real estate sector. In addition, the depreciation of the US dollar has provided a boost to the development of emerging economies. From the perspectives of economic fundamentals and the repatriation of de-dollarization funds, the RMB has the momentum for appreciation, while the RMB's movement against a basket of currencies has remained basically stable. Under the trend of de-dollarization, RMB assets and the offshore RMB capital market will face structural opportunities for revaluation and expansion. Asset allocation should abandon bear market thinking and emphasize trading and left-side positioning. What are the key points for asset allocation in the second half of this year? The bond market is expected to maintain a fluctuating trend. What are the operational suggestions? Zhang Jiqiang, Director of Huatai Securities Research Institute and Chief Fixed Income Analyst, stated that this year is a significant year for the macro cycle, with event-driven market trends being prominent and investors' allocations becoming more diversified and decentralized. In terms of asset allocation, investors should abandon bear market thinking, emphasize trading and left-side positioning, and focus on investment odds. In bond investment, the core contradiction in the bond market in the second half of the year is the "lack of certainty" amidst multiple intersecting variables. It is highly likely to continue exhibiting characteristics of a fluctuating market, with many disturbances and difficulties in judging the rhythm. The 10-year Treasury bond rate is expected to fluctuate between 1.5% and 1.8%. Strategically, it is necessary to emphasize swing trading, duration adjustment, and selection of bond types. The US stock market may face a concurrent downturn in three cycles. Lin Xiaoming, Chief Financial Engineering Analyst at Huatai Securities Research Institute, conducted research and judgment on asset allocation and the style of the A-share market in the second half of the year from the perspective of quantitative models. Lin Xiaoming pointed out that in the second half of the year, the global Kitchin cycle will enter a downturn phase, and the US stock market may face a concurrent downturn in the Kitchin, Juglar, and Kondratieff cycles. Against this backdrop, how to seek safe-haven assets amidst a liquidity crisis has become the key to asset allocation in the second half of the year. Unlike previous cycle downturns where safe-haven assets performed well, in this cycle downturn, it is possible that shorts in risky assets will outperform longs in safe-haven assets. Due to the constraints of US fiscal issues on US Treasuries, they may not be ideal safe-haven assets during this downturn period. Against the backdrop of increasingly unclear global trade and fiscal prospects, the long-term allocation value of gold will become more prominent. In the equity market, A-shares are likely to outperform overseas markets. It is recommended to adopt a barbell allocation strategy combining dividends and growth, and to pay attention to policy negotiation opportunities in the consumer sector. The revaluation process of Chinese assets has just begun. From a strategic perspective, given the expectation of RMB appreciation and the global de-dollarization process, will the pricing logic of A-shares change? What investment themes are worth paying attention to in H2? He Kang, Chief Strategist and Co-Head of Financial Engineering at Huatai Securities Research Institute, stated that in the long run, the revaluation process of Chinese assets has just started. Against the backdrop of RMB appreciation and global de-dollarization, the expectation of foreign capital inflows has strengthened, and their preferences may dominate the pricing power of A-shares. Index-weighted stocks and companies with excellent fundamentals are likely to benefit, corresponding to the finance, consumer, pharmaceutical sectors, and industry leaders. He Kang believes that multiple investment themes in the A-share market in H2 can be summarized as follows: After the trough of the real estate cycle, overlooked consumer demand and overlooked productivity improvements, especially capital expenditures in the high-tech sector, may gradually surface. H-shares show greater resilience amid the revaluation of RMB assets. This year, several top-tier enterprises have completed their H-share listings, injecting new vitality into the H-share market. Li Yujie, a strategy researcher at Huatai Securities, believes that factors such as Chinese enterprises going global, global reallocation driven by de-dollarization, and the internationalization of the RMB are highlighting the importance of the H-share market. In the medium and long-term, the expansion of the H-share market implies a need for increased capital allocation. It is recommended to pay attention to two trend changes: First, the technology sector corresponding to improved growth prospects. Global capital is more overweight in US technology stocks but remains underweight in Chinese ones. Second, with improved liquidity, the AH premium is expected to narrow. Scarcity plays in industry leaders, large-cap stocks, and active stocks under the Stock Connect scheme are worth noting. In the short term, external market disturbances may affect the performance of H-shares, but there are differences between Hong Kong and the US in terms of economic cycles and market positions. Moreover, H-shares show greater resilience amid the revaluation of RMB assets. The main driver of H-share performance in H2 may come from a "U"-shaped recovery in earnings.

Macro News 1. On the 28th, He Lifeng, Member of the Political Bureau of the CPC Central Committee and Vice Premier of the State Council, met with Dan Simkowitz, Co-President of Morgan Stanley in the US, at the Great Hall of the People. He Lifeng stated that China is committed to promoting high-quality development through high-level opening up, and welcomes more US financial institutions, including Morgan Stanley, and long-term capital to continuously deepen mutually beneficial cooperation with China and actively participate in the construction and development of China's capital market. Simkowitz expressed that Morgan Stanley will continue to expand its presence in the Chinese market and provide high-quality services to facilitate investment cooperation between US and Chinese enterprises. 2. From the 27th to the 28th, Zhang Guoqing, Member of the Political Bureau of the CPC Central Committee and Vice Premier of the State Council, conducted a survey in Shanghai on promoting the healthy development of the platform economy and market supervision. He emphasized the need to thoroughly implement the important instructions and directives of General Secretary Xi Jinping, implement the decisions and arrangements of the CPC Central Committee and the State Council, focus on promoting high-quality development, comprehensively strengthen governance capabilities in the field of market supervision, promote the construction of a sound ecosystem for the platform economy, and maintain a fair and orderly market environment. 3. On May 28th, Foreign Ministry spokesperson Mao Ning presided over a regular press conference. Mao Ning stated that China has decided to expand the scope of visa-free countries. From June 9, 2025, to June 8, 2026, a visa-free policy will be implemented on a trial basis for holders of ordinary passports from Saudi Arabia, Oman, Kuwait, and Bahrain. Individuals from these four countries holding ordinary passports who come to China for business, tourism, visiting relatives and friends, exchanges, visits, or transit for no more than 30 days may enter the country without a visa. 4. According to the National Disease Control and Prevention Administration, the upward trend of the COVID-19 epidemic nationwide has slowed down, and the epidemic has reached its peak or is showing a downward trend in most provinces. The dominant circulating strain is the sixth-generation sub-lineage NB.1.8.1 of the XDV variant, with no significant changes observed in its pathogenicity or clinical severity of the disease. Industry News 1. It has been learned from multiple informed sources that at a recent symposium on upstream and downstream enterprises in the China-EU semiconductor industry held by the Ministry of Commerce, the policy on rare earth export controls was explained, and communication with China-EU chip enterprises on rare earth export controls was strengthened to maintain the stability of the global industry chain. Another informed source indicated that this move implies that China may relax rare earth export controls targeting the industry chain of China-EU semiconductor enterprises. 2. The Office of the National Healthcare Security Administration conducted an investigation into cases of "ghost pharmacists" (pharmacists whose names are listed but who are not actually present) at designated retail pharmacies. Through screening and analysis, it was found that the names of some pharmacists (corresponding to the same ID numbers) appeared in the drug expense details of multiple designated retail pharmacies, suggesting possible violations such as pharmacist information being falsified or pharmacists engaging in "ghost pharmacist" practices. Designated retail pharmacies found to have engaged in violations such as falsified pharmacist information, "ghost pharmacists," or failure to provide pharmaceutical services as required will be subject to measures such as interviews, rectification within a specified time limit, suspension of the medical insurance service agreement, or termination of the medical insurance service agreement, depending on the severity of the violations. 3. The website of the Shenzhen Municipal Housing and Construction Bureau released the "Administrative Measures for the Allocation and Sale of Affordable Housing in Shenzhen (Draft for Soliciting Opinions)" and the "Administrative Measures for the Planning and Construction of Affordable Housing in Shenzhen (Revised Draft for Soliciting Opinions)". The drafts mention that allocation-and-sale-type affordable housing will be subject to strict closed-loop management, and it is prohibited to convert such housing into commercial housing in any way. 4. It has been learned from informed sources that DJI's robotic vacuum cleaner products have entered mass production and are expected to be launched in June. It is understood that DJI has been engaged in the R&D of robotic vacuum cleaners for more than four years, and the upcoming product is a robotic vacuum and mop combo. 5. The General Office of the People's Government of Fujian Province issued the "Implementation Plan for Special Actions to Boost Consumption in Fujian Province", which proposes supporting automobile consumption. It supports various regions in carrying out automobile consumption promotion activities and providing additional support through preferential car purchase policies. 6. The State Administration for Market Regulation recently issued the "Action Plan for Key Technological Innovations in Metrology and Testing". The Plan proposes that by 2030, more than 50 key metrological core technologies will be achieved, more than 20 new-generation international first-class metrological standards will be established, the self-controllable rate of core devices for newly established metrological standards will reach over 60%, and the leading rate in international metrological comparisons will reach 20%. 7. It was learned from the media briefing on promoting the trade-in of e-bikes in Guangdong that as of May 26, the sales volume of e-bikes traded in in Guangdong Province reached 174,000 units, ranking among the top in the country, with the trade-in volume being approximately three times that of the previous year. The cumulative subsidy funds used amounted to 87.08 million yuan, boosting new e-bike consumption by over 400 million yuan. Corporate News 1. Jiaying Pharmaceutical announced that it is under investigation by the China Securities Regulatory Commission for suspected violations of laws and regulations in information disclosure. 2. China Energy Engineering Group announced that it has won the bid for the 6×660 MW coal-fired power project in the Bingzhun Industrial Park of the China-Kyrgyzstan-Uzbekistan Railway, with a bid amount of approximately 14.586 billion yuan. 3. *ST Jilin Pharmaceutical announced that its shares will be delisted on May 29. 4. *ST Longjin announced that its shares will enter the delisting consolidation period starting from June 6. 5. ST Huaxi announced that it has signed a major contract for daily operations worth approximately 2.084 billion yuan. 6. Fuda Co., Ltd. announced that it plans to invest in the construction of a project for ultra-precision gears for electric drive systems in NEVs and a project for robotic transmission joint components. 7. Longgao Co., Ltd. announced that the restructuring of its controlling shareholder is undergoing the approval process for the assessment report. 8. Jiangsu New Energy announced that its future performance is related to multiple factors such as the natural resources at the project sites, and significant changes may bring about performance fluctuation risks. 9. China Flag Chemical announced that the company currently has the project approval procedures for chlorantraniliprole, but it has not yet officially commenced production. 10. ST United announced its intention to acquire 100% equity in Jiangxi Runtian Industry, a packaged drinking water company, and its stock will resume trading. 11. Shangwei Cable announced that the company's actual controller has been changed to Zhang Hua. 12. At the earnings briefing, executives of Huguang stated that the first prototype line for the humanoid robot project has been successfully implemented. 13. IntSig Information announced its intention to plan for the issuance of H shares and list them on the Hong Kong Stock Exchange. 14. China National Gold Group announced that its controlling shareholder intends to increase its stake in the company by 168 million to 335 million yuan. 15. Lier Chemical stated on its interactive platform that the 5,000 mt/year chlorantraniliprole production facility is under accelerated construction. Global Markets 1. The three major U.S. stock indices closed lower collectively, with the Dow Jones falling 0.58%, the Nasdaq declining 0.51%, and the S&P 500 index dropping 0.56%. Most popular Chinese ADRs closed lower, with the Nasdaq Golden Dragon China Index falling 0.71%. 2. WTI crude oil futures prices closed up 1.56% at $61.84 per barrel. Brent crude oil futures closed up 1.26% at $64.9 per barrel. 3. COMEX gold futures closed down 0.48% at $3,312.4 per ounce, and COMEX silver futures closed down 0.65% at $33.095 per ounce. 4. Nvidia reported revenues of $44.1 billion in the first fiscal quarter, up 69% YoY, and a net profit of $18.78 billion in the first fiscal quarter, up 26% YoY. Investment Opportunities Reference 1. Xiaomi YU7's pre-booking inquiries exceed those of SU7 during the same period, with the number of users leaving their information being about three times higher. According to media reports, Lu Weibing, Partner and President of Xiaomi Group, stated at the earnings call that Xiaomi YU7 has been well-received by users since its pre-release, becoming more popular and well-known than when Xiaomi SU7 was first unveiled. Lu Weibing revealed that after the technical release of YU7, the number of pre-booking inquiries exceeded those of SU7 during the same period. As of May 25, the number of users leaving their information for the "YU7 Technical Launch Event" was about three times that of the "SU7 Technical Launch Event" during the same period. YU7 has a broader audience than SU7, and we are very confident in YU7. YU7 is expected to be officially launched in July this year. Previously, Xiaomi Auto announced that it had raised its delivery target for 2025 to 350,000 units (up from 300,000 units). Driven by factors such as strong product competitiveness and the launch of new models, Xiaomi Auto's sales are expected to continue to accelerate. Guotai Haitong Securities stated that Xiaomi Group's YU7 was launched on May 22, and its sales after the new model's launch are worth looking forward to, with the industry chain expected to continue benefiting. 2. WeRide Enters Saudi Arabian Market, with Three Major Products Deployed Recently, WeRide, a global leader in autonomous driving technology, announced its market expansion strategy in Saudi Arabia, marking a further expansion of the company's global commercial footprint. As the first step in entering the Saudi market, WeRide has tested and deployed autonomous driving products such as Robotaxi, Robobus, and Robosweeper in key Saudi cities including Riyadh and AlUla, laying the foundation for subsequent large-scale commercial operations across Saudi Arabia. With the rapid development of artificial intelligence (AI) technology, autonomous driving is undergoing unprecedented changes. From intelligent perception to precise decision-making, and from efficient control to data-driven operations, AI has injected strong momentum into autonomous driving. Haitong Securities pointed out that previously, the main barriers to the development of large-scale autonomous driving models included computing power, data loops, etc., with leading autonomous driving enterprises mostly being top-tier technology companies. Following the release of Deepseek's faster inference model, latecomers (including vehicle manufacturers and solution providers) are expected to gain new opportunities, and the autonomous driving algorithm sector is expected to witness a flourishing landscape. Therefore, 2025 is expected to be a year of rapid penetration of high-level intelligent driving, with numerous opportunities emerging across the industry chain. 3. Three Departments, Including MIIT, Coordinate to Promote the Development of Advanced Computing Industry According to media reports, the Ministry of Industry and Information Technology (MIIT), the National Development and Reform Commission (NDRC), and the National Data Administration jointly issued the "Implementation Plan for the Digital Transformation of the Electronic Information Manufacturing Industry" to strengthen the construction of new-type information infrastructure. The plan coordinates the promotion of the development of the advanced computing industry, accelerates the integration of networks, data, computing power, and algorithms, drives innovative development in high-performance computing, intelligent computing, and cloud-edge-end collaborative computing, improves the network layout of edge computing centers, and builds a new-type information infrastructure that is highly reliable, high-performance, and widely connected. It promotes the deep empowerment of new-type information infrastructure in electronic information manufacturing applications, accelerating the large-scale application of advanced computing, 5G-A, gigabit optical networks, industrial internet, and AI in the electronic information manufacturing industry. Advanced computing encompasses three major areas: computing power, algorithms, and data, covering various computing methods such as cloud, edge, and end computing. As the core productivity in the digital economy era, computing power plays a crucial role in driving technological and industrial progress, accelerating the deep integration of digital technologies with the real economy, and its strategic and supportive roles are becoming increasingly prominent. Shanxi Securities believes that the demand for AI computing power from two major downstream sectors, the internet and intelligent computing centers, will continue to experience high growth, with rapid progress in localization procurement. 4. Musk's Brain-Computer Interface Company Completes New Round of Financing It is reported that Musk's brain-computer interface company, Neuralink, has raised $600 million in a round of financing, bringing the company's valuation to $9 billion. In recent years, the global brain-computer interface (BCI) technology has witnessed rapid development, with its application areas gradually expanding from the medical field to non-medical fields such as education and gaming. Meanwhile, the rapid evolution of emerging technologies like artificial intelligence (AI) is driving more breakthroughs in the application of BCI technology. According to PrecedenceResearch, the global BCI market size was approximately $2.62 billion in 2024 and is expected to reach $12.4 billion by 2034, with a compound annual growth rate (CAGR) of 17.4% from 2025 to 2034.

On Wednesday local time, the US Fed released the minutes of its May monetary policy meeting on its official website. The minutes showed that Fed officials believed they might face a "difficult trade-off" in the coming months, with both inflation and unemployment rising, and increased economic uncertainty justifying a cautious monetary policy stance. The meeting minutes indicated that policymakers judged that the risks of both rising unemployment and inflation had increased since the March resolution, primarily due to the impact of Trump's tariff policies. This situation could create a conflict between the Fed's goals of price stability and full employment, forcing members to decide whether to prioritize tightening monetary policy to combat inflation or to support economic growth and employment by cutting interest rates. Participants agreed that, given the continued solidity of economic growth and the labour market, along with the current moderately tight monetary policy, the Federal Open Market Committee (FOMC) had the flexibility to wait for greater clarity on the outlook for inflation and economic activity. However, it was evident that uncertainty about the economic outlook had further increased, and thus officials believed it was appropriate to adopt a cautious stance until the economic impacts of the Trump administration's series of policy changes became clearer. The meeting minutes highlighted the willingness of Fed officials to maintain interest rates unchanged for a period, as policy changes in Washington cast a shadow over the economic outlook. At the May meeting, the FOMC kept the target range for the federal funds rate unchanged at 4.25%-4.5% for the third consecutive time. Following the interest rate decision this month, Trump made progress in trade negotiations with other countries. On May 8, Trump announced the outline of a new trade agreement with the UK. Subsequently, China and the US also agreed to significantly reduce tariffs on each other's goods. Despite this, US tariff rates remained at historically high levels, forcing many companies to put hiring and investment decisions on hold. Therefore, as the US economy adjusted to the higher tariffs proposed by the Trump administration, nearly all participants indicated that inflation might be more persistent than expected. The US Fed projected that, due to the impact of tariffs, inflation would rise "significantly" this year, while the job market was "expected to weaken substantially." Economists generally expected that tariffs would push up inflation and drag down economic growth, though they also lowered their expectations for a recession following the easing of trade tensions. The meeting minutes mentioned that Fed staff's forecasts for real GDP growth in 2025 and 2026 were lower than those presented at the March meeting, as the announced trade policies implied a greater drag on real economic activity relative to the policies assumed in staff's previous forecasts. It is expected that trade policies will also lead to a slowdown in productivity growth, thereby reducing potential GDP growth in the coming years. As of early May, officials also noted that the volatility in the US bond market in the weeks preceding the meeting was "worthy of attention," and pointed out that changes in the US dollar's safe-haven status, along with rising US Treasury yields, could have long-term impacts on the economy. The meeting also discussed the US Fed's five-year policy framework. Fed Chairman Powell stated that officials agreed on the need to reassess the key factors surrounding employment and inflation in the current monetary policy approach. The Fed's next meeting will be held from June 17 to 18, at which time the Fed will release policymakers' new forecasts for inflation, employment, and economic growth prospects over the coming period, as well as their expectations for interest rates that they deem appropriate. The market currently expects that the likelihood of an interest rate cut before the September meeting is almost zero.