Opinion: Beware that after the new Federal Reserve Chair takes office, the "positive news" may be exhausted, and uncertainties will likely erupt intensively from July to November.

BlockBeats News, December 29 — Nomura Securities issued a warning, predicting that after the new Federal Reserve Chair takes office in May next year, there will be a rate cut led by the Fed in June. However, as the US economy recovers, there may be strong internal opposition within the Federal Reserve to further rate cuts. Policy disagreements could not only weaken market confidence in the new Chair but also potentially trigger tensions between the Federal Reserve and the Trump administration. If the Federal Reserve maintains interest rates after the June meeting, it will inevitably clash with Trump, who demands further rate cuts to boost midterm election prospects. Nomura expects uncertainty to peak between July and November next year, during which the market may see a “flight from US assets,” leading to a decline in US bond yields, a correction in US stocks, and a weakening dollar. Investors should be alert to possible liquidity reversals during this period. Major global economies may also halt rate cuts or even begin rate hike cycles, thereby diminishing the relative advantage of dollar assets. The policy deadlock, combined with signs of inflation bottoming out and the end of the Fed’s rate cut cycle, will intensify market volatility.