💥💥 Exploded! Oil prices soar, and interest rate cut expectations may vanish overnight? — The probability of the Federal Reserve cutting rates three times this year has dropped from 50% to 20%!
A letter from Hormuz, global inflation expectations have taken off directly.
Brent crude oil jumped nearly 13%, reaching $82. Then looking at the currency market: the possibility of the Federal Reserve cutting rates three times in 2026 has dropped directly from 50% to 20% last week. The probability of the UK cutting rates in March has crashed from 80% to 60%. The European Central Bank's rate cut this year has been halved, leaving only 5 basis points.
A strategist from Nuveen Investment put it plainly: the continuous rise in oil prices will complicate the disinflation process, and rate cuts can only be postponed.
Now looking at the cryptocurrency market?
Bitcoin first crashed and then rebounded, at one point dropping below 63,000, now hovering around 66,000. The entire network liquidated 574 million dollars, with 146,000 people suddenly disappearing. Ethereum also barely closed at 1944 dollars.
The managing partner of Tokenize Capital said it clearly: Bitcoin is the only large liquidity pool traded 24 hours a day, absorbing all the selling pressure over the weekend. The real test will come when U.S. stocks open tonight and ETFs resume trading — if funds withdraw, 63,000 may not hold.
The current question is: is this wave of inflation shock temporary or a long-term battle? Will the Federal Reserve be forced to remain inactive throughout the first half of the year?
The probability of a rate cut in March is only 6.4%, and the June window is still open, but it is narrowing.
Are you betting on rate cuts or betting on inflation? Let's discuss in the comments.