Zheshang Securities: The Federal Reserve restarts interest rate cuts, and domestic interest rate cuts are gradually approaching

According to the Zhitong Finance APP, Zheshang Securities has released a research report stating that after the Federal Reserve resumes interest rate cuts, the probability of the domestic central bank "following up" with rate cuts has increased, with a higher likelihood of implementation after the end of October. After three consecutive months of adjustments, the current bond market has shown initial signs of stabilization, and as we enter the fourth quarter, bond market interest rates may begin a new round of smooth decline. Investors are advised to prepare for defensive counterattacks and to enter the market around 1.8% for 10-year government bonds. Key points from Zheshang Securities: External constraints weaken: "Room for maneuver" opens up. Since mid-July 2025, U.S. employment data has weakened, and expectations for Federal Reserve rate cuts have gradually strengthened, leading to a narrowing of the China-U.S. interest rate differential and a decrease in capital outflow risks, creating a certain window for the central bank's monetary easing. The weakening of the dollar has led to a passive appreciation of the yuan, an increase in foreign exchange settlement demand, and a marginal improvement in the domestic liquidity environment, thus opening up room for interest rate cuts. Exchange rate pressures have eased, but it is still necessary to prevent the side effect of "rapid appreciation of the yuan → decline in export competitiveness," making rate cuts by the central bank somewhat necessary. Internal constraints remain: Low bank interest margins + rising real interest rates. Current interest rate cuts still face the dual constraints of "low bank net interest margins + rising real interest rates." The net interest margin of commercial banks has fallen to historical lows, and further unilateral reductions in the benchmark lending rate may further undermine bank profitability and willingness to extend credit, leading the central bank to be more cautious about comprehensive rate cuts. Inflation expectations are relatively weak, and significant rate cuts may lead to higher real interest rates, which could, to some extent, suppress consumption and investment. Domestic interest rate cuts are approaching: Higher probability after the end of October. After the Federal Reserve resumes interest rate cuts, the probability of the domestic central bank "following up" with rate cuts has increased, but the pace, magnitude, and method will be "dominated by us," with a higher likelihood of implementation after the end of October. After three consecutive months of adjustments, the current bond market has shown initial signs of stabilization, and as we enter the fourth quarter, bond market interest rates may begin a new round of smooth decline. Investors are advised to prepare for defensive counterattacks and to enter the market around 1.8% for 10-year government bonds. Risk Warning: The market is influenced by many factors, and technical analysis has certain limitations; Macroeconomic policies may undergo unexpected marginal changes, which could alter asset pricing logic and lead to adjustments in the bond market; Institutional behavior has a certain unpredictability, and when institutional behavior converges significantly and forms negative feedback, it may lead to adjustments in the bond market