10-Year Treasury Yield Plunges as Investors Flee to Safety - Crypto Opportunity Brewing?
Safe-haven demand surges as traditional markets wobble, sending Treasury yields tumbling in a classic risk-off move.
The Flight to Quality
Investors are dumping risk assets and piling into government bonds like there's no tomorrow—which, given current market conditions, might not be far off. The 10-year yield's dramatic slide signals growing anxiety about economic stability.
Crypto's Contrarian Play
While traditional investors hide in Treasuries, digital asset veterans see blood in the water. History shows crypto often moves inversely to traditional safe havens once the initial panic subsides. This yield collapse could be setting the stage for a massive rotation into decentralized assets.
Wall Street's favorite hiding spot looking a bit crowded? Maybe it's time to consider assets that don't rely on government promises—just mathematics and network effects.
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Investors have taken a risk-off approach in recent days amid a slide in stocks and rising volatility, resulting in increased demand for safe-haven assets like Treasuries and Gold (XAUUSD). As a reminder, a Treasury’s yield moves in the opposite direction of its price.
Rate Cut Odds Surge Higher
Surging rate cut odds following comments from Fed Bank of New York President John Williams are also affecting the 10-year yield. Williams said that he supports “further adjustment in the NEAR term to the target range for the federal funds rate” in order to achieve a neutral rate. A neutral rate neither stimulates nor hinders economic growth.
The odds of a 25 bps cut at the December 9-10 Federal Open Market Committee (FOMC) meeting on CME’s FedWatch tool spiked to 73.3% compared to 39.1% a day ago and 44.4% a week ago.
