Markets Price Four More Fed Hikes as Bitcoin Falls Below $83,000
Interest-rate futures imply the federal funds rate could reach 4.75%-5% by June 2027, while the 10-year Treasury yield rises above 5.1%.
Markets are pricing four more Federal Reserve rate increases by June 2027 as Treasury yields climb and Bitcoin (BTC) falls below $83,000, tightening financial conditions across risk assets.
Interest-rate futures imply the federal funds rate could rise from its current 3.75%-4% range to 4.75%-5% by June 2027. The pricing reflects four additional increases of 25 basis points each.
Treasury yields rose across the curve. The 10-year yield moved above 5.1%, its highest level since 2007, while the 20-year yield approached 5.5%. The iShares 20+ Year Treasury Bond ETF also fell below $80.
Bitcoin dropped from a recent high near $87,500 to below $83,000. The dollar index climbed above 101 and is up 3% this year, adding pressure to cryptocurrencies and other risk-sensitive assets. Gold traded above $4,200 after falling 25% from its January record.
The market shift comes as stronger economic growth, renewed inflation concerns linked to tensions in the Middle East and heavy borrowing for artificial-intelligence infrastructure raise expectations for higher borrowing costs. Government bond yields also increased in France, Germany, the United Kingdom and Japan.
