This week, global capital markets are driven by a three-pronged main storyline that is converging: macro easing, an industry boom, and geopolitical games. The market structure has switched completely: marginal cooling in inflation pressures, a sharp retreat in expectations of Fed rate hikes—combined with a once-in-a-generation surge in capital for the global AI industry. As a result, the technology growth track has once again become the market’s absolute main line. Meanwhile, the situation in the Middle East remains tense, leaving global assets exposed to uncertainty and risk hedging needs.
I. US inflation falls significantly, and expectations for Federal Reserve policy are restored
The latest US July inflation data shows broad weakness: year-over-year CPI is 3.4%, core CPI is 2.5% year-over-year, and PPI has eased to 4.7%. Clear signals indicate that inflation is cooling.