Institution: Beware of the risk of inflation rising again in 2025, the Federal Reserve may be forced to slow down interest rate cuts or even restart rate hikes

ChainCatcher news, according to Jinshi reports, multiple Wall Street institutions warn that the risk of a rebound in U.S. inflation in 2025 is increasing. Goldman Sachs Chief Economist Jan Hatzius predicts that if Trump's tariff proposal is implemented, it could push the core PCE index, which the Federal Reserve focuses on, up by nearly 1%. Anders Persson, CIO of Nuveen Global Fixed Income, which manages $1.3 trillion in assets, stated that inflation rates may remain above the Federal Reserve's 2% target for the next 12 months and even for several years; in the worst-case scenario, the Federal Reserve may be forced to pivot 180 degrees and restart interest rate hikes, leading to more severe stagflation.

The market expects that the CPI data for November, to be released this Wednesday, will continue to rise, with the core CPI annual rate possibly remaining above 2% until October next year. Derek Tang, an economist at Monetary Policy Analytics, pointed out that if the CPI data exceeds expectations and the previous values are revised upward, it could change policymakers' assessment of inflation and affect the pace of interest rate cuts in 2025. In the current situation, Nuveen recommends focusing on fixed income assets, expecting that U.S. Treasury yields will provide substantial returns over the next 12 months; if the economy falls into stagflation, cash may become the best-performing asset class.