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Powell: Short-term inflation expectations have risen in recent weeks, while most long-term inflation expectations remain consistent with the 2% target.
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Market risk exists, and investment requires caution. This article does not constitute personal investment advice and does not take into account individual users' specific investment objectives, financial conditions, or needs. Users should consider whether any opinions, views, or conclusions in this article are consistent with their specific circumstances. Investment based on this information is at your own risk.

The 2-year US Treasury yield declined slightly to 3.69%, spot gold remained below $4,900, and the US Dollar Index rose 0.2%. The Federal Reserve held steady, with board member Miran calling for rate cuts.

The Federal Reserve kept interest rates unchanged. The statement of the decision noted: Governor Milanweed dissented, citing the uncertain situation in the Middle East.
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Market risks exist, and investment should be approached with caution. This article does not constitute personalized investment advice and does not consider any individual user's specific investment objectives, financial situation, or needs. Users should evaluate whether any opinions, viewpoints, or conclusions presented here are appropriate for their particular circumstances. Any investment decisions made based on this information are at your own risk.

# US-Iran Military Operations Enter Day 19; Middle East Energy Infrastructure Faces Escalating Attack Risks
The US-Iran military operations have entered their 19th day, with the risk of attacks on Middle Eastern energy facilities rapidly escalating. Iran has announced it will make a full-scale strike against US-related oil facilities and has designated the energy infrastructure of Saudi Arabia, the UAE, and Qatar as legitimate strike targets. The relevant facilities have subsequently initiated emergency evacuations. International oil prices have surged in response.
During Wednesday's US stock market opening, Brent crude oil approached the $110 mark as the US stock market reached daily highs, with intraday gains expanding to approximately 6.3%; US WTI crude oil surged past $99.40, gaining about 3.3% intraday.
According to CCTV News, on Wednesday, March 18 local time, Iran's Islamic Revolutionary Guard Corps Navy Commander Tangsiri warned that Iran now treats US-related oil facilities and US military bases equally and will make a full-scale strike against them. He called on workers at relevant facilities and nearby residents to evacuate to safety. According to reports from Iranian media cited by Xinhua News Agency, a spokesman for Iran's armed forces central command Hatam Anbia said the same day that Iran will make a severe retaliation against actions targeted at Iran.

The US and Israel military strikes against Iran have entered their 19th day, with multiple high-ranking Iranian officials killed, triggering an angry response from Tehran. Iran has vowed to expand military offensives against the US and Israel, while the two allies face strategic disagreements. Europe refuses military involvement, and nuclear negotiations face dim prospects. The conflict between both sides continues to escalate, with the situation becoming increasingly complex.

HSBC strategists indicate that the probability of a global stock market downturn has increased to 35% due to the Middle East conflict. Despite heavy market sell-offs, oversold buying opportunities have appeared in markets such as South Korea, South Africa, and Indonesia. The strategists advise looking for investment opportunities with defensive qualities within cyclical sectors, rather than adopting a fully defensive approach.

Middle East tensions have led to the closure of the Strait of Hormuz, causing aluminum prices to surge significantly. London Metal Exchange aluminum prices have approached four-year highs. Reduced production at Bahrain Aluminum has exacerbated supply tightness, with market concerns over aluminum supply shortages intensifying. Analysts anticipate aluminum prices could climb to $4000/ton. Despite the price increases, market institutional participation remains limited, with short positions growing, indicating disagreement over the future direction of aluminum prices.

Energy prices are surging, and most Asian economies' GDP growth forecasts have been downgraded, though Malaysia and Australia, as net natural gas exporters, will benefit from this. In policy responses, countries have generally leaned toward fiscal subsidies and price caps rather than monetary tightening.
Affected by weak demand and supply contractions, U.S. commercial real estate prices have underperformed inflation and lagged significantly behind residential property. The rise in capitalization rates is primarily driven by asset price declines and narrowing spreads on U.S. Treasury securities, reflecting insufficient risk compensation. Meanwhile, a refinancing peak is expected in 2026-2027, increasing debt risks.
Given moderate inflation data and better-than-expected declines in nonfarm employment, the urgency for the Federal Reserve to adjust monetary policy is not high. The Fed is expected to maintain interest rates unchanged at the March policy meeting. Additionally, it's worth noting whether Powell will comment on his reappointment as governor during the press conference.

Recently, Zhang Yu, chief economist at Huachuang Securities, shared her views on global macroeconomics, China's economy, and major asset classes at an event.
She judged that several slow-moving variables in the economy over the past few years are changing rapidly. The new economy's share has exceeded that of the old economy. Financial assets have now matched the scale of real estate assets, and consumption and total economic output will begin to gradually become "desensitized" to real estate.
Regarding the closely watched oil prices and inflation, Zhang Yu made two judgments: First, China faces relatively lower risks from rising oil prices compared to other oil-dependent countries; Second, the global stagflation risk is greater than China's, and it would be quite difficult for China to experience stagflation, with the core issue being that "inflation" will be difficult to reach particularly high levels.
She believes that China's midstream manufacturing will enter a favorable window for global strategy in the next 2-3 years. In terms of investment significance, this is comparable to real estate 20 years ago, consumer liquor stocks 10 years ago, and gold 3 years ago.
She believes that both the real economy and capital markets will give birth to some exceptionally outstanding companies.

The Bank of Canada decided on March 18 to keep interest rates unchanged at 2.25%, focusing on the impact of Middle East conflicts on the economy. Although rising oil prices may push up inflation in the short term, the central bank emphasized that growth risks are skewed to the downside, with a weak employment market and intensifying trade frictions leading to poor economic data performance. Analysts believe the central bank's dovish tone is evident, but its stabilizing stance may be difficult to sustain.

Powell's lawyer stated that if the investigation is not concluded by the time Powell's term as Federal Reserve chair ends, Powell will not resign and will remain in office as an exception. This could impact U.S. macroeconomic policy and financial market expectations, while also increasing the difficulty for Trump to interfere with the Federal Reserve.

China's cloud computing industry is facing a relatively rare price increase trend. Alibaba Cloud and Baidu Intelligent Cloud have raised prices on certain products by up to 34% due to surging global AI demand and rising supply chain costs. This trend marks the loosening of a 20-year "price reduction inertia," and the cloud market may be entering an unprecedented price increase cycle. Analysts believe that rapid growth in AI computing power and limited supply will push cloud infrastructure into an inflationary environment.

Trump reportedly exempts enforcement of the Jones Act to curb high oil prices. The exemption applies to oil, natural gas, fertilizer, and coal.
Risk Disclosure and Disclaimers
Market risks exist; investment requires caution. This article does not constitute personal investment advice and has not considered individual users' specific investment objectives, financial situations, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Investment decisions based on this content are at your own risk.

U.S. diesel prices broke through $5 per gallon this week due to Iranian situation impacting crude oil supply, causing structural challenges in the diesel market. Diesel consumption is driven by commercial activity, and price increases directly impact business profitability. U.S. diesel inventory remains below historical averages, with continued demand growth potentially triggering broader inflationary pressures.

Micron Technology will announce its fiscal 2026 second quarter results on Wednesday, with revenue expected to grow 148% year-over-year. The storage chip shortage is primarily driven by surging demand from the AI market, which has pushed prices higher and impacted PC and smartphone shipments. Although Micron has launched capacity expansion plans, supply release still requires time, and the market expects the memory shortage to persist through 2027.

This session is hosted by Guo Shengbei, discussing the relationship between oil prices and CPI and their impact on government bonds, analyzing the advantages and disadvantages of Treasury Inflation-Protected Securities (TIPS) compared to regular Treasury bonds and corporate bonds, as well as investment decision-making strategies amid uncertain geopolitical situations in the Persian Gulf.

Goldman Sachs' credit strategy team issued a pessimistic warning in its latest report, stating that market stress has not yet been fully released, and listed AT1 bonds, investment-grade hybrid bonds, and BB-rated high-yield bonds as the next potentially liquidated assets. At the same time, corporate financing costs remain elevated, interest coverage ratios face risks, the macroeconomic outlook is complex, and markets are transitioning from shock pricing to economic impact pricing.

US February core PPI rose 3.9% year-over-year, exceeding expectations and the prior reading; PPI growth both year-over-year and month-over-month surpassed expectations. The market reminds investors to exercise caution; views in this article do not constitute personal investment advice.