The Federal Reserve Will Launch A Bloody Battle.

Before the weekend, the market is short of significant factors. At the same time, investors will try to avoid arbitrary speculation on the eve of a series of heavy interest rates next week, such as the Fed's interest rate increase.

The recent turmoil in the international financial market and the slow improvement in US inflation level have reduced the market's expectations of raising interest rates by the Federal Reserve in September.

On Friday, the US producer price index, though slightly above the expected value, is still leveling off. This makes the Fed, which has long emphasized data dependence, lacks enough data to support interest rate hikes.

The bulk trading market was again on the decline Friday.

Investors should be cautious about holding commodity futures before the end of the week.

The slowdown in China's economic growth and the decline in the RMB exchange rate make the prospects for raw materials and consumer goods such as copper, iron and agricultural products very worrying.

Crude oil continues to be affected by the global oversupply.

Saudi Arabia, Iraq and other Arabia Peninsula OPEC countries insist on not reducing production to regain market share, which makes global oil prices under tremendous pressure.

According to a government report released on Friday, wholesale prices in the US were basically flat in August, and fuel costs were low, which implied that inflation would remain weak.

Just as the Fed's September monetary policy conference is about to be held, today's inflation data may make policymakers "think twice before doing so".

Judging from the current situation, the market has greatly lowered the Fed's expectations of raising interest rates next week. At the same time, financial market prices have not calculated the Fed's interest rate into the current price level. If the Fed's FOMC committee finally decided to raise interest rates, the market will surely make rapid adjustments, and huge fluctuations are inevitable.

On the other hand, if the Fed abandonment raises interest rates at the September meeting, it means that officials' concerns about inflation in the US continue to be maintained, which will contradict the Fed's previous belief that inflation will pick up.

Many investors will be forced to reconsider whether the long-term investment strategy is in line with the Fed's current attitude and position.

This will also lead to huge fluctuations in the market.

No matter what decisions the Fed decision makers will make at the end of the day, there will be unavoidable turbulence in the market next week.

The Bank of England has just announced interest rate resolution this week, and the MPC Committee of the Central Bank continues to maintain its current interest rate with 8:1 votes.

But central bank officials remain optimistic about the outlook for the UK economy, and the market is still predicting that Britain will raise interest rates in the near future.

Data released by the US Department of labor (DOL) show that the US producer price index (PPI) is flat in August, and is expected to fall by 0.1%, up 0.2% in July.

Wholesale price constraints also reflect a drop in global commodity costs, suggesting that inflation may remain below the Fed's target for some time.

Fed policymakers will meet next week to consider whether the first rate hike since 2006 has been launched.

Earlier, the Fed said that low energy prices and strong U.S. dollar are temporary factors that affect inflation.

The Federal Reserve will hold a policy meeting on 16-17 September.

Futures traders believe that Federal Reserve officials will not raise interest rates when capital markets fluctuate drastically.

Federal funds interest rate futures, which have been traders' vane for decades, show a 28% chance of raising interest rates next week.

Analysts' expectations are slightly higher. Half of the 81 analysts surveyed by Bloomberg expect to raise interest rates this time.

Since 2008, the Federal Reserve has kept interest rates at near zero levels to support the economy.

Guy Haselmann, Scotiabank strategist in Canada, said that in her nearly 30 years of Wall Street career, she had never seen such a bewilderment and confusion.

He pointed out that the industry was largely at a loss.

It sends out complex signals.

A member of the Federal Reserve talked about the interest rate hike the day before. On the second day, other members called for an immediate increase in interest rates.

Ray Dalio, founder of Bridgewater Associates, the world's largest hedge fund company, believes that the Federal Reserve's interest rate hike will be a huge disaster when the global economic situation is fragile. Eventually, the policy will suddenly turn and liquidity gates will open again.

A survey released by the Bank of England on Friday showed that more and more British people began to accept the message conveyed by central bank governor Carney that the UK will usher in the first rate hike before the outbreak of the financial crisis.

According to the survey, the percentage of Britons who expect to raise interest rates in the next year will be less than those who expect to cut interest rates in the next year. The difference has risen from 33% in May to 46%.

The Bank of England says this is the highest level of interest rate hike since May 2011.

Although inflation in Britain is close to zero, Carney said that the decision to raise interest rates will become clearer at the end of the year.

Analysts forecast that the Bank of England will maintain interest rates at a record low until the first quarter of next year, as the central bank wants to ensure that the profit recovery is stable.

The Bank of England survey shows that the public expects inflation to be 2% in the next 12 months and 2.2% in May.

Inflation expectations for the next two years and five years remain unchanged at 2.3% and 2.8% respectively.

Forbes, member of the Bank of England's Monetary Policy Committee (MPC), said that if the strength of the pound confirms that inflation is less than expected, then the Bank of England needs to increase interest rates sooner than the model shows.

Forbes said,

The appreciation has contributed to the decline in import prices, and the decline in import prices is one of the important factors in the near zero inflation rate in recent months.

However, Forbes said in his speech on Friday that past experience and some basic assumptions about the impact of exchange rate on inflation can not explain the current situation in Britain very well.

More attention should be paid to the underlying reasons behind the trend of exchange rate.

Forbes said, "maybe this is the right time for today.

Most importantly, this approach also suggests that the recent appreciation of sterling will have less effect on import prices and inflation than we think.

If so, the tightening time of monetary policy needs to be earlier than that predicted by previous models. "

In the European market on Friday, as investors shifted their attention to next week's fed resolution, the overall market trend was stable.

Compared with the relative calm of foreign exchange market, the precious metal market seems a bit uncontrollable.

Spot gold plunged 30 U.S. dollars in the day, gold prices fell below the 1110 pass, the lowest downlink test 1098.66.

Spot silver fell more than 2% in the day, and silver fell to 14.30, refreshing its two week low.

In terms of foreign exchange market, the US dollar, pound sterling, Australian dollar and yen trend is very mild, maintaining the cross star trend.

The euro / dollar has been maintained, but the foreign exchange market has been down sharply.

Offshore renminbi rose 1.15% against the dollar yesterday, the biggest gain since 2010.

The strong stabilization of the renminbi has made market risk appetite warmer.

In addition, intraday data showed that the US consumer confidence index of University of Michigan in September dropped to 85.7, less than 91.5 of market expectations and a year low.

But even though the data are not as good as market expectations, the market reaction is rather dull, with the overall attention shifting to the Fed's interest rate resolution next week.