Bitunix Analyst: The market is beginning to reprice the risk of "energy inflation," and the Federal Reserve may be forced to enter a longer period of watchful waiting

Mars Finance News, on May 12, the market’s core change is no longer only whether the Iran situation will escalate, but that energy shocks have begun to trigger a chain reaction with the U.S. inflation structure, the transition of power at the Federal Reserve, and global capital’s need to seek safety. The risk in the Strait of Hormuz has not yet been resolved. Iran refuses to give up on enriched uranium, while the U.S. continues to release signals that military action may resume, keeping crude oil and gasoline prices at high levels. Against this backdrop, the U.S. April CPI data is viewed by the market as a crucial turning point—not merely a one-off energy-driven inflation boost, but a growing concern that high oil prices may spread again to housing, services, and the overall core price system.

At present, the market expects the U.S. April headline CPI year-over-year rate could rise to 3.7%, a near three-year high, while core CPI could also rebound to 2.7%. The most worth watching is not energy itself, but the possibility that housing inflation may reheat due to statistical revisions and renewed rental expenses, further weakening the main support that has kept U.S. inflation cooling over the past two years. If housing and energy form a double pressure at the same time, market expectations for the Federal Reserve to cut rates by the end of the year will be pushed further back, and even the possibility of repricing the likelihood of maintaining high interest rates for a longer period may begin to be reconsidered.

Meanwhile, the Federal Reserve’s power structure is also entering a sensitive stage. Waller has cleared the procedural obstacles in the Senate and, at the fastest, could officially assume the position of Fed Chair this week, but the timing of his inauguration coincides with a moment when energy inflation is starting to rise again, the White House continues to exert pressure to cut rates, and disagreements within the Federal Reserve are intensifying. The market is concerned that if oil prices remain high over the coming months, the Federal Reserve will be forced to maintain an extremely passive policy posture between “fighting inflation” and “political pressure,” and the dollar liquidity environment will therefore remain persistently tight.

As for the crypto market, although BTC has recently continued to trade in high-level consolidation, the market structure has gradually shifted from “liquidity-driven” to “risk re-pricing.” If tonight’s CPI is higher than expected, the U.S. dollar and U.S. bond yields may strengthen again, suppressing risk appetite and potentially slowing momentum for price chasing above BTC; conversely, if core inflation does not run out of control, it will help the market sustain expectations that liquidity may still have room to loosen within the year. The real focus in the market right now is no longer whether the Federal Reserve will cut rates, but whether the world is once again entering a new “structural high inflation era” driven jointly by energy, geopolitics, and supply chains.