With Donald J. Trump, the 47th President of the United States, set to assume office in a few days, global markets are already experiencing repercussions. The inauguration scheduled for January 20 has brought about uncertainties regarding economic policies. Market observers have been drawn to concerns surrounding inflation, escalating bond yields, and fluctuations in the cryptocurrency market.
Trump’s Economic Policies and Inflation Concerns
The U.S. economy is characterized by a strong labor market and surprisingly robust Non-Farm Payroll (NFP) data. The Consumer Price Index (CPI) is anticipated to surpass the figures from the previous month, whereas the Producer Price Index (PPI) has shown a decrease. Nevertheless, apprehensions about inflation have been fueled by Trump’s discourse on trade policies. Of particular note is the gradual implementation of tariffs on China, causing unease in the markets. These developments have led to an uptick in U.S. Treasury yields, with yields on 10-year and 30-year bonds nearing 5%, negatively impacting stock markets. The S&P 500 is at risk of falling below the 5800 level, while Bitcoin (BTC) briefly dipped below $90,000. The cryptocurrency market remains vulnerable amid this climate of uncertainty.
Optimistic Expectations in the Cryptocurrency Market
Reports from QCP Capital indicate that certain figures within the Trump administration have shown a favorable stance towards cryptocurrencies, instilling hope among investors. Analysts propose that rumors of supportive measures for the cryptocurrency market could provide temporary relief. However, prevailing market uncertainties continue to urge investors towards cautious behavior. Analysts foresee heightened volatility post Trump’s inauguration. The ongoing evaluation of the $90,000 threshold for Bitcoin and the rise in bond yields signal persistent risks in the market. QCP Capital advises investors to stay alert amidst market fluctuations during this period.
