Recently, there's been an interesting observation — the U.S. December non-farm payroll data is actually quite contradictory.
On one hand, indicators like new job creation, job openings, and wage growth rates all point to a cooling labor market, meaning corporate hiring enthusiasm is fading. However, the unemployment rate did tick down slightly, which counts as one of the few bright spots. Combining these data points, the Fed has little reason to rush into rate cuts — the market is already pricing in unchanged rates for January, with rate cuts unlikely until June at the earliest.
But there's another variable in play. Reports suggest the Supreme Court will soon announce that IEEPA tariff measures carry constitutional risks. If this happens, economic prospects would improve marginally and inflationary pressures would ease. While this isn't good news for the fiscal deficit, market sentiment would lean toward optimism.
So the current situation is: the Fed standing pat, and tariff disruptions gradually fading. Under this combination, U.S. Treasury yields face significant near-term pressure, with a high probability of remaining elevated. In contrast, U.S. equities still have AI momentum intact, and with declining tariff risks, sectors like consumer staples and industrials that were hit hard by tariffs previously now have room for a bounce.
For crypto traders, this means U.S. dollar strength may persist, but the recovery space for risk assets is also expanding — this is a dual-sided dynamic that warrants close monitoring.
Recently, there's been an interesting observation — the U.S. December non-farm payroll data is actually quite contradictory.
On one hand, indicators like new job creation, job openings, and wage growth rates all point to a cooling labor market, meaning corporate hiring enthusiasm is fading. However, the unemployment rate did tick down slightly, which counts as one of the few bright spots. Combining these data points, the Fed has little reason to rush into rate cuts — the market is already pricing in unchanged rates for January, with rate cuts unlikely until June at the earliest.
But there's another variable in play. Reports suggest the Supreme Court will soon announce that IEEPA tariff measures carry constitutional risks. If this happens, economic prospects would improve marginally and inflationary pressures would ease. While this isn't good news for the fiscal deficit, market sentiment would lean toward optimism.
So the current situation is: the Fed standing pat, and tariff disruptions gradually fading. Under this combination, U.S. Treasury yields face significant near-term pressure, with a high probability of remaining elevated. In contrast, U.S. equities still have AI momentum intact, and with declining tariff risks, sectors like consumer staples and industrials that were hit hard by tariffs previously now have room for a bounce.
For crypto traders, this means U.S. dollar strength may persist, but the recovery space for risk assets is also expanding — this is a dual-sided dynamic that warrants close monitoring.