CITIC Securities: The US dollar is expected to remain weak during this round of rate cuts. Gold is expected to perform well. A CITIC Securities research report indicates that the Federal Reserve's 25 basis point rate cut at its September 2025 meeting is in line with market expectations. Powell stated that this was a risk-management rate cut, favoring the labor market's downside risk within its dual mandate. The dot plot indicates a further 50 basis point rate cut this year, which is in line with expectations. CITIC Securities still expects the Fed to cut rates by another 25 basis point at its October and December meetings. The interest rate path for 2026 will become clearer once the new Fed Chair is finally selected. Market-wise, after the rate cut, US Treasuries saw a renewed "buy the anticipation and sell the reality" trend, while US stocks continued to rally, with the Dow Jones Industrial Average and small-cap stocks performing well. It is recommended to downplay the guidance provided by this meeting on the interest rate path for next year. The US dollar is expected to remain weak during this round of rate cuts, and gold is expected to perform well.
