China International Capital Co says US inflation remains driven mainly by structural factors such as energy shocks; cyclical inflation is not yet evident. Rising AI-driven capex and improving employment pose upside aggregate-demand risks. Baseline: the Fed will neither cut nor raise rates this year and is expected to keep a hawkish stance. After Wosh takes office his priority will be rebuilding policy credibility; he is more likely to demonstrate resolve by reinforcing expectations for balance-s

China International Capital Co says US inflation remains driven mainly by structural factors such as energy shocks; cyclical inflation is not yet evident. Rising AI-driven capex and improving employment pose upside aggregate-demand risks. Baseline: the Fed will neither cut nor raise rates this year and is expected to keep a hawkish stance. After Wosh takes office his priority will be rebuilding policy credibility; he is more likely to demonstrate resolve by reinforcing expectations for balance-sheet reduction (QT) rather than signaling rate hikes. A 'QT first, delayed cuts' outcome cannot be ruled out and would continue to pressure liquidity-dependent assets and those that benefited from excess dollar liquidity or are misaligned with his policy stance.