Rising Rate-Hike Expectations Could Instead Create the Next Buying Opportunity

The biggest market significance of this round of U.S. August CPI data is that it has brought “the Federal Reserve hiking rates again” from a low-probability event into the spotlight. Data showed that headline CPI rose 3.4% year on year and core CPI rose 2.4%, while the market’s probability of a September rate hike increased notably after the data was released.
In the short term, this is certainly not the scenario risk assets prefer. Higher interest rates raise funding costs, while a stronger dollar and higher U.S. Treasury yields can also weigh on BTC, gold, and high-valuation growth stocks. #每周来晒 and #8月CPI数据出炉
But from another perspective, the market has already begun pricing in hawkish expectations. If future data does not continue to deteriorate, rate-hike expectations could instead become a case of “bad news being priced in.” That is also why U.S. stocks did not suffer a sharp sell-off after the CPI release.
My strategy will lean more toward offense within a defensive framework: waiting for confirmation of a pullback before positioning in BTC; focusing in U.S. stocks on companies with strong profitability whose AI capital expenditures can be converted into revenue; and continuing to monitor geopolitical risks and changes in real interest rates for gold.
In one sentence: This is not the time to blindly go long, but it is still far from the time for a full retreat. The opportunities truly worth seizing are the mispriced sell-offs that emerge after volatility expands.