The market is "pricing in the risk of rate hikes," but it's far from the stage of "a rate hike cycle has already begun."
All risk assets are pulling back, and the core issue is not actually sentiment, but rather macro conditions are shifting. Oil prices have been sustained at elevated levels for an extended period, and inflation expectations are re-emerging—this is the most damaging logic in the current market. More critically—the market is beginning to reprice the possibility of rate hikes rather than rate cuts. Current rate expectations: April rate hike 25bp probability: 12.4% Cumulative rate hike 25bp probability by June: 21.9% Maintaining rates unchanged remains mainstream (approximately 76.5%) This reveals one thing: rate hikes are not the main theme, but have shifted from "zero probability" to "a risk that needs to be priced in." And once the market begins pricing in rate hikes, it directly suppresses valuations (particularly Nasdaq, tech stocks, AI concept stocks + Crypto). Another overlooked point: the new Federal Reserve Chair won't take office until after June, and even if there is a personnel change, it doesn't immediately mean a shift toward rate cuts. Monetary policy has never been decided by one person, but rather represents consensus under the Fed's long-term systemic operations.
The market is "pricing in the risk of rate hikes," but it's far from the stage of "a rate hike cycle has already begun."
All risk assets are pulling back, and the core issue is not actually sentiment, but rather macro conditions are shifting.
Oil prices have been sustained at elevated levels for an extended period, and inflation expectations are re-emerging—this is the most damaging logic in the current market.
More critically—the market is beginning to reprice the possibility of rate hikes rather than rate cuts.
Current rate expectations:
April rate hike 25bp probability: 12.4%
Cumulative rate hike 25bp probability by June: 21.9%
Maintaining rates unchanged remains mainstream (approximately 76.5%)
This reveals one thing: rate hikes are not the main theme, but have shifted from "zero probability" to "a risk that needs to be priced in."
And once the market begins pricing in rate hikes, it directly suppresses valuations (particularly Nasdaq, tech stocks, AI concept stocks + Crypto).
Another overlooked point: the new Federal Reserve Chair won't take office until after June, and even if there is a personnel change, it doesn't immediately mean a shift toward rate cuts.
Monetary policy has never been decided by one person, but rather represents consensus under the Fed's long-term systemic operations.