On the eve of the non-farm payroll report, the whole market is betting: Will Powell be "driven crazy" by oil prices?

Right now, the global financial markets look very much like a large battlefield.
The Middle East is at war,
Oil prices are flying wildly,
BTC is plunging,
And tonight, the US non-farm payroll data is coming again.
Many people may not realize:
The ones who are truly suffering the most are actually the Federal Reserve Chair.
Because now, Powell faces the most headache-inducing situation:
The economy is beginning to slow down,
But oil prices might push inflation back up.
This is called "stagflation risk."
And it’s the thing the financial markets fear the most.
If the situation in the Middle East continues to worsen, and crude oil prices keep rising, US inflation is very likely to re-emerge.
So what will the Fed do?
Cutting interest rates would worry about inflation rebounding,
Not cutting rates would fear economic slowdown.
So tonight’s non-farm data is very special in significance.
It will determine whether the market is more worried about:
“Recession,” or “out-of-control inflation.”
If non-farm payrolls weaken significantly:
The market will think the Fed is forced to cut rates.
BTC and US stocks may rebound together.
Because liquidity expectations will heat up again.
But if non-farm payrolls are strong and oil prices are high, then the market will enter the most uncomfortable scenario:
“Maintaining high interest rates for longer.”
This is not friendly to BTC.
Because in the past few years, Bitcoin’s biggest upward momentum was essentially driven by global easing.
The cheaper the money,
The crazier BTC gets.
Now the question is:
Will the conflict in the Middle East continue to escalate?
I think there will be friction in the short term, but the probability of full-scale war is not high.
Because Iran knows that truly blockading the Strait of Hormuz would be equivalent to a full confrontation with the global energy market.
And the US also doesn’t want to get involved in a long-term Middle East war.
Both sides are more like “controlling escalation.”
But even so, market volatility will not be small.
Because what capital fears most is not bad news,
But uncertainty.
And the current uncertainty is almost at its maximum.
So tonight’s data will very likely determine the market rhythm for the next week.
If the data is weak:
BTC may quickly rebound.
If the data is strong:
The market may continue to stage a “high-level sell-off.”
In one sentence:
It’s not just the crypto world trading,
But the global macro trading the crypto world.
#美伊冲突再升级