According to investments on Thursday, the weakness of the US dollar, increased risk of governance, and the yield curve infants are creating a bullish story for Bitcoin. Notes From QCP Capital, based in Singapore.
The US Dollar Index (DXY), which tracks the value of the US dollar compared to a basket of foreign currency, has reduced its value by 11% since the first half of this year and is currently hovering at around 98.23.
“This is the biggest decline since 1973, over 50 years ago,” said Stephen Gregory, founder of Crypto Trading Platform Vtrader. Decryption.
“It’s clear that US institutions are hedging the declined dollar,” Gregory said as Friday was hit by a record high of $3,578 on September 3. Liquidity from gold is likely to follow “fixed supply assets such as Bitcoin and Ethereum,” he said.
The US dollar decline comes from selling bond markets, with experts citing inflation concerns as the main reason for the 30-year surge in yields in the US, UK, Australia and Japan.
“It’s really rare for the Treasury yield to rise in the Fed’s easing cycle over 30 years,” says Robin Brooks, a senior fellow at the Global Economy and Development Program at Brookings Institute. Tweet on wednesday.
Many countries have previously shifted debt issuance to short-term maturities, leading to a global increase in long-term government bond yields, Brooks later said. Tweet“movements that may come back to bother us”
In addition to focusing on short-term maturities, most central banks around the world expect to have already begun or even more easing, thereby maintaining a fixed front-end.
However, recent bond sales have widened the gap between short-term and long-term yields, resulting in a steeper yield curve. In other words, investors are demanding higher returns to lend money for longer periods of time.
In addition to this complex mix, concerns about the independence of the Federal Reserve system are growing. President Donald Trump repeatedly pressured him to award Chairman Jerome Powell to serve the US high levels of interest on sovereign debt.
According to QCP, the fear is why premiums “remaintain higher on the long edge and the yield curve becomes steeper.”
The steep yield curve “inflation expectations are high, but it can also show investors believe the economy will grow,” Gregory said.
With inflation rising, “risk assets like Bitcoin tend to be better than the market,” he explained.
Bitcoin’s return since the start of the year was around 96%, down nearly 11% from its record high of $124,545. Co Ringecko The data will be displayed. However, Friday hit a record high of 3,578 on Tuesday, up 35% this year.
