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Why did Americans buy electric cars in a crazy way, but the Fed's expectation of a rate cut intensified?
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Hello everyone, today XM Foreign Exchange will bring you "[XM Group]: Why did Americans buy electric cars crazy, but why did the Fed's expectation of interest rate cuts heat up?" Hope it will be helpful to you! The original content is as follows:
The 80-year-old retired doctor John McCabe was preparing to test drive the red EV6 and bluntly said: "Anyway, if you want to buy it, it's better to get it while the discount disappears." His choice is not an isolated case, but a typical reaction of American consumers to the reduction of fiscal subsidies - the expiration of the $7,500 federal tax credit, which forces users with car purchase plans to spend in advance to lock in the last wave of fiscal dividends.
JD Power data shows that this "advanced car purchase" has driven the retail share of electric vehicles to hit a record high in August, but the concentrated release of demand is not a signal of market prosperity, but a demand overdraft before fiscal policy declines. "When fiscal subsidies www.xmniubi.completely disappear, the automobile consumer market will face a significant demand gap, laying the groundwork for subsequent industrial shrinkage.
After the subsidy policy slope, the subsequent consumption data in the United States is likely to be affected.
Tynans Nissan sales director Markus Kamm's amazement at sales-"This is simply incredible", behind which is the forced support of fiscal subsidies to consume.
39-year-old bus driver Paul Ibarra admitted: "I can't afford Ariya without purchase discounts." "This kind of "fiscal subsidy-dependent consumption" exposes the core contradiction: the current car purchase fever is "early withdrawal" supported by fiscal support, rather than the continuous growth of real demand.
With the official withdrawal of fiscal subsidies on September 30, consumers who originally entered the market due to discounts will return to the state of "insufficient purchasing power", and the demand in the automobile market will quickly shift from "overheating" to "cooling".
This situation of demand faults has been affected by the United States in the past few months.The impact of consumption base may make the consumption data released by the United States later lower than expected, thereby increasing the rationality of the Federal Reserve's interest rate cut.
The industry is shrinking upstream and downstream, and monetary policy may relay fiscal policy for automobile subsidies
GM lays off about 360 employees at its Detroit factory and cuts production GMC HummerEV and pure electric Cadillac Escalade IQ. These actions are not isolated corporate decisions, but responses to the imminent shift in fiscal policy for automobile subsidies.
When fiscal support disappears, this ultra-low price model is unsustainable. Dealers need to digest inventory and car www.xmniubi.companies need to reduce production capacity to match the real needs in the future.
From the procurement of battery raw materials to the production of parts and then to vehicle manufacturing, the automobile industry chain has begun to show "shrinkage adjustment", and this downward pressure on the production side directly points to a macro conclusion: after the fiscal policy exits, the US economy may face local downward risks and needs other policy tools to undertake it. The Federal Reserve's monetary policy naturally becomes the core of market attention.
Politics acceptance expectations strengthened: production contraction has gradually heated up the market discussion on the Fed's interest rate cut
Colorado Governor Jared Polis admitted: "Tax credit will not last forever, and the purpose of the policy is to accelerate the popularization of new technologies."
But after fiscal policy "retirement" has been achieved, the economic gap left behind needs to be filled - as an important part of the US manufacturing industry, if the production contraction continues, it may affect employment and industrial output.
The market thus forms a consensus: the Federal Reserve may use monetary policy to undertake the supporting role of fiscal exit and stabilize the economy through loose policies.
Specifically, the "economic cooling signal" released by the contraction of production will strengthen the market's expectations of the Federal Reserve's "rate cuts to stimulate demand": If corporate investment and consumption demand declines due to fiscal decline, interest rate cuts will become a key tool to boost market confidence and alleviate industrial pressure.
The impact of increased interest rate cut expectations on assets
The first thing that is to bear is that the US dollar, which is at the forefront of the decline, is innocently caught in the shooting. One of the core drivers of the US dollar trend is the interest rate spread expectations between the United States and other major economies. When the Federal Reserve's expectation of interest rate cuts heats up, the yield attractiveness of US dollar assets will decline, and the willingness to inflow capital weakens, which will lead to pressure on the US dollar.
The current production contraction in the automobile industry chain is directly affected by the US dollar trend through the logic of "economic downward risks → expectation of interest rate cuts by the Federal Reserve → narrowing of interest rate spread advantages".
When this car purchase wave caused by fiscal subsidies ends, the production contraction of the automobile industry chain will be further clarified, the expectation of the Federal Reserve's monetary policy will be more consolidated, and the suppression of the US dollar by expecting interest rate cuts will continue.
The strength of the US dollar in the future depends not only on US economic data, but also on the rhythm of fiscal and monetary "policy relay". The changes in the electric vehicle market are a vivid portrayal of this macro game.
After market expects fiscal support to decrease, the Federal ReserveIt will be taken over by interest rate cuts, which means that the "high interest rate dividend" of the US dollar may fade in the future, and the US dollar index faces continuous downward pressure, and the short-term boom in the electric vehicle market is just a "micro footnote" of this macro logic.
After that, gold and global stock markets will also share the liquidity redistribution during the period when the US dollar index is loose.
The above content is all about "[XM Group]: Why did Americans buy electric cars crazy, but why did the Fed's expectation of interest rate cuts heat up?", which was carefully www.xmniubi.compiled and edited by the editor of XM Forex. I hope it will be helpful to your transactions! Thanks for the support!
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