🔥 IMPORTANT: US Bond Yields Keep Rising... And That's Good 🤯📈
Despite recently announced trade agreements, U.S. Treasury bond yields continue to rise... and that might seem like a bad sign for the market, but the reality is more complex.
📉 Why would this normally be negative?
🔻 When yields rise, bonds become more attractive than stocks.
🔻 This causes a rotation of capital: investors sell stocks and buy bonds → demand for stocks falls → their prices fall.
🔻 In addition, bond yields directly influence interest rates throughout the economy.
🔻 Higher rates = more expensive to borrow = less growth for companies → affects sensitive sectors like tech and also assets like
#Bitcoin. 🤔 But... can it be positive?
👉 Yes! Because this rally may indicate that investors see strength in the US economy in the long term.
👉 It may also reflect a lower perception of risk, which is healthy for financial assets in the medium term.
👉 And if inflation continues to fall, the Fed may avoid further rate hikes, giving oxygen to markets.
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