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Recently, the US CPI data for January surprised market expectations, and the inflation rate exceeded market expectations, triggering a sharp ** in global financial markets. The release of this data triggered a correction in the market's expectations for the Fed's interest rate cut, gold prices**, bond yields**. In addition, it has been reported that the total amount of shadow banking loans in the United States has exceeded $1 trillion, and there is a systemic risk that if there is a problem, it will have a huge impact on the entire financial system. The current situation has put the United States in a quagmire, and whether it is a rate cut or no rate cut, it can lead to a crisis. This article will elaborate further on this issue.
The original article mentioned that the US CPI increased by 3 year-on-year in January1%, beating market expectations of 29%。But why is inflation rising and prices persistent?
First, the economic recovery has created an imbalance between supply and demand in the labor market. With sustained economic growth and a booming job market, labor shortages have become a bottleneck restricting economic growth, and labor costs have risen, driving prices**.
Secondly, the recent sharp increase in global raw materials and commodities, especially global commodities, has had a significant impact on inflation.
In addition, fiscal stimulus measures in the United States** are also one of the reasons for the rise in inflation. Trump** has stimulated economic growth through massive tax cuts and fiscal spending, but it has also brought inflationary pressures.
Overall, the current rise in inflation in the United States is due to a number of factors, including the imbalance between supply and demand in the job market, global goods***, and fiscal stimulus. The combination of these factors has caused the inflation rate to exceed market expectations, causing market concerns and**.
The release of the US CPI data had a huge impact on the global financial markets, and the market reacted violently.
First of all, **substantially**. As inflation data exceeded expectations, the market expected the Fed's rate cut to be delayed, and the dollar index was supported, resulting in ***, as a representative of safe-haven assets, experiencing selling pressure amid market concerns about inflation.
Secondly, **market emerges**. NASDAQ ***133%, S&P and Dow Jones have also followed. This is due to the fact that rising inflation may cause the Federal Reserve to delay interest rate cuts, which in turn will have a negative impact on economic growth, raising investors' concerns about the outlook for corporate earnings.
In addition, U.S. Treasuries also appeared, with the 10-year Treasury yield rising by 8 basis points. This suggests that the market's inflation concerns have led to a correction in the bond market, and investors' demand for U.S. Treasuries has decreased, resulting in higher bond yields.
Overall, after the release of the US CPI data, there was a clear ** in the financial market. The bond market has adjusted, and market worries have intensified.
In addition to the unexpected increase in inflation data, another factor that raises market concerns is that shadow banks in the United States have received more than $1 trillion in loans, and there is a systemic risk. These shadow banks lend to high-risk capital demanders through leveraged lending.
First of all, the loan model of shadow banking has the problem of insufficient information disclosure. As shadow banking lending is difficult to effectively regulate, many fintech companies and private credit groups are not well known, leading to a lack of clarity in the market about their risks.
Second, shadow banking has already secured a massive $1 trillion in loans, and if something goes wrong, it would have a huge impact on the entire financial system. At present, the regulator has issued a warning about this, believing that the leverage amplification of these shadow banking loans is a systemic risk that needs to be paid attention to and supervised.
Overall, the risk of shadow banking lending in the United States has been highlighted by the market after the release of inflation data. Due to the lack of information disclosure and the huge scale, once a problem occurs, it will have a huge impact on the entire financial system, and the regulatory authorities need to pay close attention and take effective measures.
The recently released US CPI data for January exceeded market expectations, triggering a violent ** in international financial markets. Rising inflation data and the risk of shadow banking lending have raised concerns about the outlook for the U.S. financial system. Whether it is the postponement of interest rate cuts due to rising inflation, or the crisis in the financial system caused by the risk of shadow banking lending, it will have a big impact on the US economy and global financial markets. In the face of this situation, all relevant parties need to pay close attention and take effective measures in a timely manner to stabilize the financial market and protect the stable operation of the financial system.
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