The Federal Reserve’s first rate hike in three years—what’s truly worrying isn’t these 25 basis points, but that the familiar rate-cut logic the market has grown used to may already have stopped working.
This time, the interest rate was raised to 3.75%—4.00%, passing with all 12 votes. More hawkish is the dot plot: of 18 officials, 16 expect at least one more rate hike this year. This indicates it isn’t a simple “correction”—it’s telling the market that as long as inflation can’t be brought down, high interest rates will remain.
The market reaction was equally direct. The Dow fell by about 631 points, the S&P dropped 0.45%, the yield on the 10-year U.S. Treasury climbed above 5%, and the dollar strengthened. What is now truly suppressing risk assets isn’t only the policy rate—it’s that the risk-free yield is too high. When you can earn nearly 5% just by holding U.S. Treasuries, overvalued stocks and some altcoins must demand even higher growth expectations to attract capital.
Interestingly, though, BTC is still around $76,000 and hasn’t followed U.S. equities into a clear selloff. My take is that a 25-basis-point hike has long been priced in by the market; what funds are really waiting for is when the next hike will actually be implemented.
So don’t just focus on the idea that “a rate hike becoming effective is bad news already being priced in.” Next, watch whether the U.S. dollar, Treasury yields, and BTC can keep showing this kind of divergence. If the 10-year Treasury yield continues to surge and the dollar strengthens in tandem, the crypto market’s current resilience may only mean the pressure hasn’t finished transmitting yet. #美联储加息25基点美股收跌
This time, the interest rate was raised to 3.75%—4.00%, passing with all 12 votes. More hawkish is the dot plot: of 18 officials, 16 expect at least one more rate hike this year. This indicates it isn’t a simple “correction”—it’s telling the market that as long as inflation can’t be brought down, high interest rates will remain.
The market reaction was equally direct. The Dow fell by about 631 points, the S&P dropped 0.45%, the yield on the 10-year U.S. Treasury climbed above 5%, and the dollar strengthened. What is now truly suppressing risk assets isn’t only the policy rate—it’s that the risk-free yield is too high. When you can earn nearly 5% just by holding U.S. Treasuries, overvalued stocks and some altcoins must demand even higher growth expectations to attract capital.
Interestingly, though, BTC is still around $76,000 and hasn’t followed U.S. equities into a clear selloff. My take is that a 25-basis-point hike has long been priced in by the market; what funds are really waiting for is when the next hike will actually be implemented.
So don’t just focus on the idea that “a rate hike becoming effective is bad news already being priced in.” Next, watch whether the U.S. dollar, Treasury yields, and BTC can keep showing this kind of divergence. If the 10-year Treasury yield continues to surge and the dollar strengthens in tandem, the crypto market’s current resilience may only mean the pressure hasn’t finished transmitting yet. #美联储加息25基点美股收跌
