Market's split on what rising long-term yields actually mean right now.
One camp: Higher yields = liquidity drain = bearish for risk.
Other camp: Yields ripping = liquidity injections via interventions = bullish.
As long as the market (and Scottie) keeps paying those rates, we're fine. Part of the demand for higher rates is coming from juicy returns in other assets.
In this setup, $DXY can pump while risk assets also pump. Temporary? Maybe. But it's the regime we're in.
US economic data keeps coming in hot. That's the backdrop.
One camp: Higher yields = liquidity drain = bearish for risk.
Other camp: Yields ripping = liquidity injections via interventions = bullish.
As long as the market (and Scottie) keeps paying those rates, we're fine. Part of the demand for higher rates is coming from juicy returns in other assets.
In this setup, $DXY can pump while risk assets also pump. Temporary? Maybe. But it's the regime we're in.
US economic data keeps coming in hot. That's the backdrop.
