Barrels again letting in hawks, the market will have to settle the interest-rate ledger once more.
BlockBeats news: On September 30, Federal Reserve Governor Bahl said that further rate hikes may be necessary. He also noted that the trend of inflation returning to 2% in a timely manner is not clearly visible, and the risks to achieving the inflation target have increased.
The immediate impact of such remarks is that expectations for higher interest rates will continue to raise the attractiveness of the U.S. dollar and U.S. Treasury yields. This makes it even harder to relax valuation levels and leverage preferences for risk assets. If yields and the U.S. Dollar Index continue to strengthen afterward, sentiment pressure on assets like BTC and ETH will be more evident. However, if it’s only the officer’s verbal hawkishness, the market typically first looks at how quickly it gets digested.
Are you more focused on the U.S. Dollar Index surging higher, or on U.S. Treasury yields setting the tone for the market first?
Figure 1: Bahl turns hawkish: rate-hike expectations suppress risk assets · Source: partial screenshot of the page
Image source: https://www.theblockbeats.info/flash/369627
BlockBeats news: On September 30, Federal Reserve Governor Bahl said that further rate hikes may be necessary. He also noted that the trend of inflation returning to 2% in a timely manner is not clearly visible, and the risks to achieving the inflation target have increased.
The immediate impact of such remarks is that expectations for higher interest rates will continue to raise the attractiveness of the U.S. dollar and U.S. Treasury yields. This makes it even harder to relax valuation levels and leverage preferences for risk assets. If yields and the U.S. Dollar Index continue to strengthen afterward, sentiment pressure on assets like BTC and ETH will be more evident. However, if it’s only the officer’s verbal hawkishness, the market typically first looks at how quickly it gets digested.
Are you more focused on the U.S. Dollar Index surging higher, or on U.S. Treasury yields setting the tone for the market first?
Figure 1: Bahl turns hawkish: rate-hike expectations suppress risk assets · Source: partial screenshot of the page
Image source: https://www.theblockbeats.info/flash/369627
