Woofun AI notes that CICC maintains its baseline forecast of no interest rate hikes for the remainder of the year, despite acknowledging that the threshold for a potential hike has decreased. The analysis follows June US CPI data showing a 0.4% month-on-month decline and a 3.5% year-over-year increase, both below expectations, driven primarily by falling energy prices.

However, CICC highlights emerging inflationary pressures from AI-related supply-demand mismatches and rising capital expenditures, alongside renewed geopolitical tensions between the US and Iran. While current data supports the Fed holding rates steady in July, recent comments from Waller suggest a reassessment of "preventive rate hikes," meaning one or two overheated data points could trigger further discussions on raising rates.