On the Impact of the Federal Reserve's Interest Rate hike on the Global Economy

Since 2022, the United States has raised interest rates by 25 basis points in March, 50 basis points in May, and 75 basis points in June. From this series of numbers, we can easily feel the tension in the domestic situation in the United States. They have raised interest rates repeatedly to alleviate a series of price increases caused by inflation and other issues.

After the release of the CPI in May, discussions about the US economy have never stopped.

On June 13th, Morgan Stanley CEO James Goldman warned: "With the Federal Reserve becoming more aggressive in fighting inflation, the likelihood of a US economic recession is increasing. In the past, I predicted a 30% risk of recession, but now I have raised this possibility to 50%.

At the press conference on the 15th, Powell also responded on whether the US economy would decline. But he always emphasized that there is no sign of an economic slowdown.

As the largest single rate hike by the Federal Reserve since 1994, after its implementation, the three major indices of the US stock market closed higher on the same day: the Dow Jones Industrial Average rose 1.00%, the S&P 500 Index rose 1.46%, and the Nasdaq Index rose 2.50%. It seems that the Economic bubble of the United States has taken a breather, but I don't think it can change the orientation of the local market economy. In the later stage, the United States still has a great probability of going down the road of economic recession. As Mokuta, chief economist of State Street Global Advisors Global Investment Management, said, the possibility of economic recession in the United States is 50%. "This does not mean that there is no way to avoid recession, but it is really difficult to avoid it.". As expected, in the early stock market on the 16th, the Dow Jones Industrial Average (DJIA) fell 30000 points after 20 minutes of opening, on the edge of a technical bear market, while the S&P 500 and Nasdaq had already fallen into a technical bear market. The extent of the impact of this interest rate hike on the later US market situation is currently difficult to determine. At the same time, I discovered another country that is also plagued by inflation - Argentina. The Argentine central bank raised interest rates every month from January to May this year, and even raised the benchmark interest rate to 52% on the 16th. As inflation intensifies in more and more countries, the world will face another economic crisis.

Against the backdrop of the pandemic tearing apart the United States, Brexit dragging down Britain, and war destroying Russia, the Federal Reserve's interest rate hike will not only have an impact on the United States itself, but also have a certain degree of impact on the global stainless steel market. Affected by the epidemic, goods are difficult to export, warehouses are piled up in ash, and the development of the stainless steel industry is hindered. Not only that, but with one developed country after another joining the ranks of the United States in raising interest rates, the world's finance has once again fallen into a crisis, with many partner companies claiming a significant decline in stainless steel sales this month.

As a national high-tech enterprise, Hangao Technology has undergone more than ten years of development and precipitation, and has sufficient courage and strength to meet this challenge. We adhere to the business philosophy of "demand oriented, innovation at the core".