January 28th, 2026

Dollar weakness isn’t just a trend. It is reshaping global asset flows

Investors are navigating a landscape defined by uncertainty, muted risk appetite, and a growing divergence between headline optimism and underlying fragility. The Federal Reserve’s first policy decision of 2026 looms large, scheduled for 3AM Singapore time on Thursday, and markets have already begun pricing in cautious expectations.

This tension is underscored by a sharp drop in consumer confidence, which tumbled to 84.5 in January from 94.2 in December, the lowest reading since 2014. Such a precipitous decline suggests that households are increasingly wary of economic conditions, possibly anticipating labor market softness or broader financial instability. Compounding this unease is the rising probability of a partial US government shutdown, fueled by political friction in Minnesota, adding another layer of near-term volatility to an already fragile outlook.

Despite these headwinds, the baseline economic forecast remains cautiously optimistic. Real GDP growth for 2026 is projected at 1.7 per cent, supported by a confluence of fiscal stimulus, accommodative monetary settings, and regulatory frameworks designed to cushion against recessionary forces. This resilience appears unevenly distributed. The equity market’s mixed performance on Tuesday, with the Dow Jones down 0.83 per cent while the S&P 500 and Nasdaq rose 0.41 per cent and 0.91 per cent respectively, mirrors this dichotomy. A steep selloff in health insurers offset gains driven by anticipation around megacap earnings, revealing how sector-specific dynamics can override broad market narratives. In this context, overreliance on a narrow set of tech giants becomes a strategic vulnerability. Diversification into the S&P Equal Weighted or Low Volatility Index offers a more balanced exposure, while selective allocations to cyclicals like financials and industrials and defensives such as targeted healthcare segments can hedge against both slowdowns and unexpected rallies.

Fixed income markets reflect similar caution. Treasury yields moved in opposite directions on Tuesday, with the 10-year yield edging up two basis points to 4.23 per cent while the two-year yield dropped more than two basis points to 3.57 per cent. This flattening of the yield curve hints at investor skepticism about near-term growth prospects, even as longer-term inflation expectations remain anchored.

The recommendation to extend duration and accumulate high-quality fixed income, particularly in developed and emerging market investment grade, aligns with a defensive posture that anticipates further monetary easing. With two rate cuts still expected in the second and third quarters of 2026, bond investors are positioning for a pivot that will likely be triggered by labour market deterioration, even if delayed data obscures the full picture for now.

Currency markets tell perhaps the most compelling story of shifting power dynamics. The US Dollar Index plunged 1.28 per cent to close at 95.80, its weakest level in nearly four years. President Trump’s public indifference to the dollar’s slide only reinforced market perceptions that US policymakers may tolerate or even welcome a weaker greenback to support exports and ease debt burdens.

The euro surged to its highest level against the dollar since June 2021, while the yen rallied sharply, closing 1.27 per cent lower against the dollar at 152.19, buoyed by speculation of coordinated rate checks between Washington and Tokyo. This broad-based dollar weakness is not merely a technical development. It reshapes global capital flows and redefines asset attractiveness. For risk assets priced in dollars, including commodities and crypto, a falling DXY lowers entry barriers for foreign investors and amplifies returns when converted back into stronger currencies.

Speaking of commodities, Brent crude jumped 3.02 per cent to 67.57 dollars per barrel following a winter storm that paralyzed US Gulf Coast exports, illustrating oil’s persistent sensitivity to supply shocks. The structural outlook remains cautious, given ample global inventories and tepid demand signals. Gold, meanwhile, soared 2.4 per cent to a record 5,136.47 dollars per ounce, cementing its role as the ultimate hedge amid geopolitical strain and economic ambiguity. The metal’s ascent underscores a flight to safety that extends beyond traditional bonds, especially as correlations between gold and the total crypto market cap reach a striking plus 0.84. This unusual alignment suggests that both assets are increasingly viewed through the same lens, as alternatives to fiat systems perceived as unstable or manipulated.

In Asia, regional equities responded positively to the dollar’s retreat and improved global risk tone. South Korea’s Kospi led with a 2.7 per cent gain, powered by memory chip stocks, while Hong Kong’s Hang Seng and Japan’s Nikkei added 1.4 per cent and 0.8 per cent respectively. These moves highlight how emerging and developed Asian markets benefit disproportionately from dollar depreciation and liquidity expansion.

Against this backdrop, the crypto market’s modest 0.77 per cent rise over the past 24 hours and 0.92 per cent weekly gain appears understated but meaningful. The move is not driven by speculative frenzy but by two converging fundamentals. First, a PayPal survey released on January 28, revealed that 39 per cent of US merchants now accept cryptocurrency, with 84 per cent expecting mainstream adoption within five years. This is not just optimism. It is evidence of infrastructure maturing beyond trading platforms and into real commerce. Second, the dollar’s collapse below 96 creates a historically bullish macro setup for Bitcoin and other digital assets. When the DXY weakens, crypto often thrives, not as a tech stock proxy, but as a non-sovereign store of value.

The surge in perpetuals trading volume by 16.08 per cent and the turn to positive funding rates signal that speculators are returning, but this time with a foundation of utility and macro support. The question now is whether sustained merchant adoption can offset structural pressures like shrinking stablecoin supplies. If real-world usage continues to grow while the dollar remains under pressure, crypto may transition from a volatile satellite asset to a core component of diversified portfolios. The current moment, quiet as it seems, could mark the beginning of that shift.

Source: https://e27.co/dollar-weakness-isnt-just-a-trend-it-is-reshaping-global-asset-flows-20260128/

Anndy Lian

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com

j j j

October 6th, 2025

From Tokyo to crypto: How political shifts and policy bets are reshaping global markets

The recent victory of Sanae Takaichi in the Liberal Democratic Party leadership race marks a pivotal moment for Japan, positioning her to step into the role of the country’s first female prime minister by mid-October. Investors caught off guard by this outcome quickly adjusted their positions, leading to notable shifts across Japanese markets. The yen weakened significantly, closing above 150 against the US dollar, while Japanese government bonds faced pressure and equities surged in response.

Takaichi’s strong advocacy for expansive fiscal and monetary policies fuelled this immediate reaction, as markets anticipated a push toward reflationary measures. Her focus on sectors such as defence, nuclear energy, and consumer support promises to drive targeted investments, potentially invigorating economic growth in areas that have long been overdue for attention.

From my perspective, this development injects a fresh dynamism into Japan’s economy, which has grappled with stagnation for years. A leader willing to embrace bold stimulus could finally break the cycle of timid reforms, though the path ahead carries risks that demand careful navigation.

Markets reacted swiftly to Takaichi’s win, reflecting a broader repricing that favoured equities over safer assets. The Nikkei 225 climbed 1.9 per cent on Friday, reaching an all-time high amid a rally in tech and semiconductor shares across Asia. Investors now expect further upside in Japanese stocks, particularly in sectors aligned with Takaichi’s priorities.

Defence and nuclear stocks stand out as prime beneficiaries, given her strategic emphasis on bolstering national security and energy independence. Infrastructure plays and domestic demand-oriented companies also look poised for gains, as her policies aim to stimulate household spending and support small caps.

Exporters benefit from the yen’s depreciation, which enhances their competitiveness abroad. Banks, however, faced initial selling pressure, as expectations for a Bank of Japan rate hike in the fourth quarter diminished under the assumption of Takaichi’s influence.

Yet, this dip presents an opportunity, in my view, because her reflationary approach could boost loan growth, and the central bank might still raise rates to manage volatility in the yen and bond markets. Overall, this sector rotation highlights a market that is betting on policy-driven growth, where winners emerge from areas tied to fiscal expansion.

Macro risks loom large in this scenario, tempering the enthusiasm. The yen’s weakness raises concerns about imported inflation and currency stability, particularly given Japan’s debt-to-GDP ratio, which exceeds 260 per cent. Such high leverage amplifies worries over fiscal sustainability if expansive policies lead to overshooting.

The Bank of Japan may be compelled to hike front-end rates, although many now anticipate a delay into 2026 amid persistent inflation and negative real yields. Policy uncertainty adds another layer, as Takaichi’s administration must balance bold promises with execution.

Investors should monitor how her government addresses these challenges, as any misstep could erode confidence. In my opinion, while the immediate rally feels justified, the long-term success hinges on disciplined implementation. Japan has seen reformist leaders falter before, so Takaichi’s ability to deliver tangible results will determine whether this surge sustains or fizzles.

Shifting to the investment thesis, the stimulus-led upside appears compelling for Japanese equities in the near term, particularly in sectors aligned with Takaichi’s agenda. A risk-adjusted strategy favours reflation beneficiaries, with appropriate hedges to mitigate volatility. The market places its bets on her delivering bold policy changes, but execution risk remains a critical factor. Fiscal discipline will prove essential to avoid exacerbating debt issues.

From where I stand, this moment offers a buying opportunity for those optimistic about Japan’s potential under new leadership. The rally could extend if Takaichi assembles a cohesive cabinet and pushes through her agenda swiftly, drawing in foreign capital seeking exposure to Asia’s third-largest economy.

On the global front, risk sentiment stayed muted due to the ongoing US government shutdown, as the Senate repeatedly failed to pass a funding bill with lawmakers sticking to their stances. This impasse delayed key data releases, including September’s non-farm payrolls, which investors awaited on Friday but never received.

In contrast, Sanae Takaichi’s LDP win captured headlines, highlighting a stark difference in political momentum between the two nations. Wall Street closed mixed on Friday, with the Dow Jones up 0.51 per cent, the S&P 500 edging higher by 0.01 per cent, and the Nasdaq dipping 0.28 per cent as the tech rally paused. US Treasury yields climbed despite services data falling short of expectations, with the 10-year yield rising 3.7 basis points to 4.119 per cent and the two-year yield also up 3.7 basis points to 3.576 per cent.

The US dollar index slipped 0.1 per cent to 97.72, while gold advanced 0.8 per cent to 3886 dollars per ounce. Brent crude gained 0.7 per cent to 64.53 dollars per barrel, buoyed by President Trump’s warnings to Hamas regarding his plan to end the Gaza war. Asian equities ended higher on Friday, driven by tech and semiconductor stocks, although early trading on Monday showed mixed results. US equity futures indicate a higher open, suggesting some resilience amid uncertainty.

Looking ahead, the week features speeches from Federal Reserve officials, including Governor Stephen Miran on Wednesday and Chair Jerome Powell on Thursday. Delays in US data persist, affecting August trade figures, initial jobless claims, and the September federal budget balance.

These events could shape market expectations, particularly around monetary policy. The US shutdown exacerbates economic fog, pushing investors toward safe havens like gold while pressuring equities. Yet the interplay with Japan’s developments creates intriguing cross-currents, where Asian stimulus might offset some Western headwinds.

Turning to the crypto market, it rose 1.04 per cent over the last 24 hours, building on its 7-day gain of 9.07 per cent and 30-day advance of 10.76 per cent. Several factors drove this momentum, starting with macro tailwinds from the US shutdown and weak jobs data, which heightened bets on Federal Reserve rate cuts.

Bitcoin surged 12 per cent last week following the shutdown and ADP jobs report showing a drop of 32K against expectations of plus 50K. Markets now see a 98 per cent chance of a cut by October 29, according to TokenPost. Gold’s 48 per cent year-to-date rise mirrored crypto’s rally as a hedge against uncertainty.

The high correlation between crypto and equities, at 0.82 over seven days versus the Nasdaq-100, amplified these gains as traders shifted into risk assets. Investors should watch Powell’s October 29 speech and FOMC minutes for insights into the rate path. This environment favors crypto as a speculative play, where dovish signals could propel further upside.

Binance’s ecosystem provided another bullish pillar, with the exchange achieving 2.55 trillion dollars in monthly futures volume, a 2025 high, and capturing 87 per cent of Bitcoin taker buy volume per CMC. Its new AI-powered Trading Signals feature boosted activity in the BNB ecosystem, lifting BNB by 18.42 per cent weekly.

Binance’s liquidity depth, holding 41.1 per cent global market share, and institutional tools draw in capital, fostering network effects for its token and partners. This dominance reinforces confidence, making Binance a linchpin in the market’s resilience. I see this as a sign of maturing infrastructure in crypto, where platforms like Binance evolve from mere exchanges to comprehensive ecosystems, attracting serious investors amid broader volatility.

Altcoin developments added a mixed but largely positive influence. Ethereum climbed 9.96 per cent weekly, approaching 4500 dollars ahead of December’s Fusaka upgrade. Solana’s Alpenglow upgrade, reducing block finality by 40 per cent, spurred 13 per cent weekly gains.

However, Bitcoin dominance increased to 58.55 per cent as traders secured profits from alts. These upgrades sustain narratives around altcoins, though Bitcoin’s seven-day RSI of 87.4 indicates overbought territory. The key question revolves around Ethereum’s post-Fusaka momentum, especially as staking yields compress. From my standpoint, altcoins offer diversification in a bull run, but their reliance on upgrades highlights the sector’s innovation-driven nature, which can yield outsized returns when executed well.

In conclusion, today’s market dynamics blend opportunity with caution. Japan’s shift under Takaichi promises stimulus-fuelled growth, potentially lifting equities and sectors like defence and nuclear, while the yen’s weakness and debt concerns warrant vigilance.

Globally, the US shutdown clouds data and sentiment, yet it bolsters rate-cut expectations that benefit risk assets, including crypto. The crypto surge, driven by macro bets, Binance’s strength, and altcoin catalysts, reflects a Goldilocks scenario for bulls. Nonetheless, resistance at Bitcoin’s 125K level and potential Fed hawkishness could prompt pullbacks.

I believe the overarching trend leans positive for investors willing to embrace calculated risks, as political and economic shifts create fertile ground for gains. Takaichi’s leadership could herald a new era for Japan, complementing crypto’s resilience in uncertain times, but success depends on policy delivery and central bank responses. This interconnected landscape demands agility, where staying informed on speeches and upgrades will separate winners from the rest.

Source: https://e27.co/from-tokyo-to-crypto-how-political-shifts-and-policy-bets-are-reshaping-global-markets-20251006/

Anndy Lian

www.anndy.com

j j j

September 3rd, 2025

The great repricing: How fiscal anxiety is reshaping global markets from bonds to Bitcoin

Global markets have entered a phase of heightened caution as fiscal stability concerns ripple across major economies, prompting investors to reassess risk assets and flock toward safer havens.

Investors pulled back from equities amid worries over government debt levels and potential policy missteps, leading to declines in key indices. This retreat reflects broader anxieties about how governments will manage swelling deficits in an environment of elevated interest rates and geopolitical tensions.

This pullback serves as a necessary correction after months of optimism driven by central bank easing expectations, but it also highlights vulnerabilities that could persist if fiscal policies fail to instil confidence. The interplay between rising yields and weakening currencies underscores a market grappling with the realities of post-pandemic debt burdens, where any sign of instability can quickly amplify losses.

US equities under pressure

In the United States, stock markets experienced notable declines, with the S&P 500 dropping 0.7 per cent, the NASDAQ falling 0.8 per cent, and the Dow Jones slipping 0.6 per cent. These moves came as traders digested ongoing fiscal debates in Washington, including discussions around debt ceilings and spending priorities that could strain the economy further.

Federal Reserve outlook and market pause

The broader context involves speculation about Federal Reserve interest rate decisions, with markets pricing in a high probability of a September cut amid softening economic data. From my perspective, these dips in equities represent a healthy pause rather than the start of a deeper bear market, as underlying corporate earnings remain robust in sectors like technology and consumer goods.

If fiscal concerns escalate into actual policy gridlock, we could see more pronounced selling pressure, especially in overvalued tech stocks that have led the rally so far this year.

Dollar strength amid global uncertainty

The US Dollar Index strengthened by 0.6 per cent to close at 98.33, benefiting from its safe-haven status amid global uncertainties. This uptick pushed the index higher to 98.37 in subsequent trading, reflecting weakness in counterparts like the British pound and Japanese yen.

The dollar’s resilience stems from relative economic strength in the US compared to Europe and Asia, where growth forecasts have been revised downward due to trade tensions and energy supply risks. I believe the dollar’s strength will continue in the near term, acting as a buffer against imported inflation, but it risks exacerbating export challenges for American firms if it appreciates too aggressively.

Rising yields and treasury market dynamics

US Treasuries faced selling pressure, with yields on the 10-year note climbing five basis points to around 4.28 per cent. This increase followed weakness in European bonds, where longer-dated securities bore the brunt of investor unease. The par yield curve data for early 2025 shows a steepening trend, indicating market expectations for higher long-term rates amid persistent inflation worries.

In my opinion, this yield surge signals investor skepticism about the Fed’s ability to engineer a soft landing without reigniting price pressures, particularly if fiscal spending remains unchecked. Treasuries, traditionally a refuge, now compete with alternatives like gold, which offer hedges against both inflation and currency debasement.

UK fiscal challenges and gilt sell-off

Across the Atlantic, the United Kingdom grapples with its own fiscal headaches, as long-term bond yields soared to levels not seen since 1998. The 30-year gilt yield jumped to 5.72 per cent, driven by a sell-off that also dragged the pound lower by as much as 1.5 per cent against the dollar.

Prime Minister Keir Starmer faces mounting pressure to clarify budgetary plans, with investors fretting over potential tax hikes or spending cuts that could stifle growth. The pound traded at a three-week low of 1.3375 against the dollar, highlighting the currency’s vulnerability to domestic policy shifts.

I see this as a critical juncture for the UK economy, where Starmer’s administration must balance fiscal prudence with economic stimulus to avoid a prolonged sterling slump. The surge in yields, while painful for borrowers, might force necessary reforms, but it risks tipping the economy into recession if not managed carefully.

Commodities: Gold and oil diverge

Commodities provided a mixed picture, with gold surging 2.2 per cent to a record high of US$3,533 per ounce. This rally gained traction from expectations of Fed rate cuts and concerns over the central bank’s independence in the face of political pressures.

Analysts project gold averaging US$3,220 in 2025, buoyed by seasonal demand and monetary easing. Brent crude oil edged up 0.7 per cent, as traders weighed supply risks from renewed US sanctions on Russia and OPEC+’s reluctance to increase output. Ukrainian drone attacks and geopolitical escalations have kept prices supported, with Brent trading around US$68 per barrel.

Gold’s ascent underscores its role as a premier safe-haven asset in uncertain times, potentially outperforming equities if fiscal woes deepen. Oil’s modest gains, meanwhile, reflect a delicate balance between supply disruptions and demand concerns, with OPEC+’s upcoming meeting likely to dictate near-term direction.

Asian markets and big tech boost

Asian equity indices opened lower in early trading, mirroring the global risk-off mood, while US equity futures ticked higher, supported by after-hours gains in Alphabet following a favourable antitrust ruling.

A federal judge decided Google would not need to divest its Chrome browser, sparking an eight per cent surge in Alphabet’s stock. This decision avoided harsher penalties, boosting investor confidence in big tech. I interpret this as a positive for the broader market, as it reduces regulatory overhang on tech giants, potentially fuelling a rebound in US indices despite Asian weakness.

In foreign exchange markets, the USD/JPY pair rose 0.8 per cent to 148.40, its highest since early August, amid fiscal concerns in Japan. Near-term support for GBP/USD lies at 1.3500-1.3560, while resistance for USD/JPY is at 148.40-148.90. These levels suggest potential consolidation as traders await clearer signals from central banks.

Bitcoin momentum and institutional interest

Turning to cryptocurrencies, Bitcoin rose 1.63 per cent to US$111,342.85 over the past 24 hours, outpacing the broader market’s 1.6 per cent gain and reversing a 2.95 per cent decline over the prior 30 days. This uptick draws from bullish institutional sentiment and technical momentum.

JPMorgan’s declaration that Bitcoin appears undervalued relative to gold stands out as a key driver. The bank notes Bitcoin’s volatility has plummeted from 60 per cent to 30 per cent over six months, the narrowest gap with gold ever recorded. Their volatility-adjusted model pegs Bitcoin’s fair value at US$126,000, about 13 per cent above current levels.

This assessment positions Bitcoin as digital gold, attracting risk-averse institutions. BlackRock’s US$58 billion stake in Bitcoin ETFs and corporate treasury allocations, now holding six per cent of supply, bolster this demand. However, Bitcoin lingers 12 per cent below its recent all-time high, offering upside potential if stability holds.

I find this JPMorgan call compelling, as it marks a shift from traditional finance’s skepticism toward embracing Bitcoin’s maturation as an asset class. Reduced volatility not only draws in more capital but also diminishes the narrative of Bitcoin as a speculative gamble, paving the way for broader adoption.

Whale accumulation and custody shifts present a mixed but largely positive impact. Institutions like MicroStrategy have added 41,875 BTC since April 2025, while custodians such as Coinbase and Anchorage Digital manage about 80 per cent of ETF-held Bitcoin. Exchange reserves have hit multi-year lows as coins move to custody, reducing immediate sell pressure. This centralisation raises risks if regulators scrutinise custodians or liquidity issues arise. Retail participation stays muted, capping organic demand.

Recent data shows whales holding 1,000-10,000 BTC adding 16,000 coins during dips, while smaller wallets sold off. From my standpoint, this dynamic favours bulls in the long run, as institutional hoarding creates scarcity, but it demands vigilance against concentration risks that could amplify volatility in downturns.

Technically, Bitcoin shows neutral to bullish signals. The price sits above the 200-day simple moving average at US$101,388, with the 50-day SMA at US$114,675 nearing a golden cross. The RSI-14 at 45.54 indicates neutral momentum, while the MACD at -1,830 suggests consolidation. Fibonacci retracement points to resistance at US$113,836 and US$115,864.

A golden cross could draw algorithmic traders, but mixed indicators imply a period of range-bound trading. Predictions see Bitcoin reaching US$120,593 by early September. I view these technicals as supportive of gradual upside, particularly if Bitcoin breaks above US$115,864, which might trigger fresh buying. Failure to do so could test support at US$107,271, but overall, the setup aligns with institutional optimism.

On X, discussions echo this sentiment, with users highlighting JPMorgan’s undervalued call and whale accumulations as bullish catalysts. Posts note corporate treasuries going crypto-native, like SharpLink Gaming’s ETH buys, reinforcing Bitcoin’s appeal. Semantic searches reveal rising institutional sentiment since August, with whales adding significant holdings.

In my opinion, these trends solidify Bitcoin’s trajectory toward US$126,000, driven by convergence with gold and structural demand shifts. While global fiscal concerns weigh on traditional markets, Bitcoin’s resilience positions it as a standout performer, potentially decoupling from equity weakness if adoption accelerates.

Conclusion: Safe havens and Bitcoin’s rise

In summary, the retreat in risk sentiment amid fiscal worries has pressured stocks and currencies, but commodities like gold and Bitcoin shine as hedges. The UK’s bond turmoil exemplifies broader challenges, while US futures hint at selective recoveries.

For Bitcoin, the combination of undervaluation signals, whale activity, and technical poise suggests substantial upside ahead. As a journalist tracking these developments, I remain optimistic about Bitcoin’s role in portfolios, viewing current dips as entry points in a maturing asset class.

Source: https://e27.co/the-great-repricing-how-fiscal-anxiety-is-reshaping-global-markets-from-bonds-to-bitcoin-20250903/