According to The Kobeissi Letter, recent 'trade deal' headlines have lost their suppressive effect on yields, with yields now rising due to decreased recession fears and heightened inflation expectations (source: @KobeissiLetter, May 23, 2025). This trend signals a potential return of trade war dynamics, which could increase volatility in global markets. For cryptocurrency traders, rising yields and renewed trade tensions often correlate with risk-off sentiment and increased crypto market volatility, making it critical to monitor these macroeconomic shifts for informed trading decisions.

According to The Kobeissi Letter, recent weeks have seen bond yields rise despite the usual 'trade deal' headlines, due to a shift in market sentiment with lower recession fears and heightened inflation expectations. This breakdown in typical market responses suggests that trade war tensions are resurfacing, which has historically driven volatility across global financial markets, including cryptocurrencies. Traders should monitor yield movements and trade war developments closely, as these factors can trigger liquidity shifts and risk-off sentiment in the crypto sector (source: The Kobeissi Letter, Twitter, May 23, 2025).

According to The Kobeissi Letter, the US 5-Year to 30-Year bond spread has steepened to 1.00% for the first time since October 2021, signaling that markets are pricing in stronger economic growth, higher inflation, and a prolonged period of elevated interest rates (source: The Kobeissi Letter, Twitter, May 22, 2025). Historically, similar steepening of the yield curve has coincided with rising CPI inflation, which can drive increased volatility and capital flows into cryptocurrencies as investors seek inflation hedges and alternative assets. Crypto traders should monitor potential shifts in risk sentiment and liquidity, as higher bond yields and inflation expectations may impact Bitcoin and altcoin price action.

According to The Kobeissi Letter, surging US deficit spending, heightened inflation expectations, and a 'higher for longer' Federal Reserve policy are causing US interest rates to climb rapidly. The US budget deficit now stands at 7% of GDP, creating pressure on bond yields and financial markets. For cryptocurrency traders, these macroeconomic shifts can intensify volatility and drive increased demand for digital assets as investors seek alternatives to traditional markets. Source: The Kobeissi Letter (May 21, 2025).

According to The Kobeissi Letter, one-year inflation expectations surged by 1.7 percentage points in April 2025, reaching 6.7%, the highest since November 1981. This marks the fourth consecutive monthly increase of at least 0.5 percentage points. Such rising inflation expectations can significantly impact cryptocurrency markets, as traders often turn to cryptocurrencies like Bitcoin as a hedge against inflation. Understanding these inflation trends is crucial for traders seeking to optimize their crypto portfolios.

According to The Kobeissi Letter, the 2-year breakeven inflation rate has surged to 3.27%, marking the highest level since the March 2023 Banking Crisis. This indicates that the market anticipates inflation to exceed 3.0% over the next two years, reflecting heightened inflation expectations and potential volatility in the bond market. Investors may need to adjust their strategies accordingly.

According to The Kobeissi Letter, the 2-year breakeven inflation rate has surged to 3.27%, marking the highest level since the March 2023 Banking Crisis. This indicates that the market expects inflation to exceed 3.0% over the next two years. Bond investors are therefore increasingly worried about inflationary pressures, as the 2-year inflation breakeven has more than doubled in recent months.

According to The Kobeissi Letter, US consumer inflation expectations have reached their highest level since 1993, while consumer confidence has significantly declined. This scenario suggests that consumers are unprepared for any further inflationary pressures and already perceive the economy as being in a recession, which may impact consumer spending and market stability.

According to The Kobeissi Letter, US consumer inflation expectations have reached their highest level since 1993, while consumer confidence has significantly decreased. This suggests potential challenges for the US economy that traders should consider, as consumers believe they are already in a recession. These factors could influence market volatility and affect asset prices in the near term.

According to @KobeissiLetter, since the Fed's pivot in September 2024, market-based inflation expectations have doubled, reaching 3.3% for the next two years. This marks the highest inflation expectation since March 2023, suggesting that traders are skeptical about the Fed's credibility in controlling inflation.

According to @KobeissiLetter, since the 'Fed pivot' in September 2024, market-based inflation expectations have more than doubled, reaching +3.3% over the next two years, the highest since March 2023. This shift indicates a significant market disbelief in the Fed's ability to control inflation, impacting trading strategies and asset valuations.

According to The Kobeissi Letter, since the 'Fed pivot' in September 2024, market-based inflation expectations have more than doubled, now anticipating a 3.3% inflation rate over the next two years, the highest since March 2023. This shift suggests traders are questioning the Federal Reserve's credibility in controlling inflation.

According to The Kobeissi Letter, the University of Michigan's long-term US inflation expectations surged to 4.1%, marking the highest level since 1993. This significant rise in inflation expectations traditionally impacts market behaviors, but recent GDPNow data has altered these dynamics. The implications for traders involve reassessing strategies in light of shifting economic indicators and potential volatility in financial markets. (Source: The Kobeissi Letter)

According to The Kobeissi Letter, there is an unprecedented gap in inflation expectations based on political affiliation, cited from ZeroHedge. Democrats anticipate 4.6% inflation, while Republicans foresee a mere 1.3%. This polarization in sentiment could influence market strategies and trading decisions as investor behavior may shift according to these expectations. Traders should monitor how this divide affects market volatility and asset valuations.

According to The Kobeissi Letter, there is an unprecedented gap in inflation expectations between political parties, with Democrats forecasting 4.6% and Republicans 1.3%, as reported by ZeroHedge. This polarization in sentiment could influence trading strategies as market participants reassess risk based on differing inflation outlooks.

According to The Kobeissi Letter, 1-year inflation expectations have surged from 2.6% to 5.0% since the trade war began, indicating a doubling in under three months. This rapid increase is causing panic among consumers and producers, potentially impacting trading strategies and market sentiment.

According to The Kobeissi Letter, 1-year inflation expectations have surged from 2.6% to 5.0% since the onset of the trade war, effectively doubling in under three months. This has caused significant panic among consumers and producers, signaling potential volatility in the markets. Traders should consider the impact of these rising inflation expectations on interest rates and currency valuations, as they could influence market strategies and asset allocations.

According to Crypto Rover, Federal Reserve Chair Jerome Powell has indicated that inflation expectations have recently increased, with tariffs being a significant driving factor. This statement could influence trading strategies, especially in sectors sensitive to inflation and trade policies.

According to The Kobeissi Letter, US services and manufacturing companies expect their costs to increase by 5.7% and 7.3% respectively in 2025, as reported by the NY Fed. This marks the largest anticipated jump for manufacturing firms in at least 3 years.

According to The Kobeissi Letter, the 5-year breakeven inflation rate has increased to 2.66%, marking the highest level since March 2023. This rise indicates growing inflationary pressures, which have surged nearly 80 basis points since September. Such shifts in inflation expectations are crucial for cryptocurrency traders, as they often signal potential volatility in digital asset markets. The increase in 2-year inflation expectations may also affect short-term trading strategies. Traders should monitor these rates closely as they can impact crypto valuations and investor sentiment.