Markets Price 30% Chance of Fed Rate Hikes as Oil Surges Above $110
Key Takeaways
- Markets shifted from pricing Fed rate cuts to rate hikes amid energy-driven inflation concerns.
- Oil remains elevated, contributing to divergences across asset classes as safe havens falter.
- Geopolitical tensions in the Middle East are shaping Fed expectations and market reactions.
Markets Price Hikes
Markets have shifted dramatically from pricing multiple cuts to a 30% chance of hikes.
“Markets move to price in rate hikes as inflation fears and geopolitics reshape Fed expectations Middle East tensions have driven divergences across asset markets as oil stays elevated and traditional safe havens falter”
The shift is driven by inflation fears tied to oil, which surged from $70 to over $111.
The 10-year Treasury yield rose to 4.40% from below 4%.
Oil Surge Fallout
Gold has fallen sharply despite its safe-haven status.
U.S. equities have weakened.
Bitcoin has outperformed, but only in the very short term.
Bitget Reports Shiba Inu Outflows
Approximately 30 billion Shiba Inu tokens exited centralized exchanges in 24 hours.
“Markets move to price in rate hikes as inflation fears and geopolitics reshape Fed expectations Middle East tensions have driven divergences across asset markets as oil stays elevated and traditional safe havens falter”
The move is widely interpreted as an accumulation signal.
Exchange reserves remain elevated in absolute terms.
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