Bitcoin y oro vuelan con la tensión del mercado de bonos

Bitcoin and gold surge as U.S. Treasury Secretary's bond market intervention unsettles investors

The cryptocurrency Bitcoin and precious metal gold are soaring due to market jitters over the U.S. Treasury Secretary Scott Bessent's intervention in bond markets. Bitcoin is on track for its best week in over three years, while gold is set to post its largest monthly gain in 26 years. The surge comes after Bessent announced on Wednesday that the U.S. Treasury plans to double its purchases of long-term public debt starting next month to stabilize the price of 10 and 30-year Treasury bonds, which have driven U.S. borrowing costs to several-decade highs due to their inverse relationship with bond prices.

Bessent stated on Thursday that he is trying to restore balance in the world's largest bond market. However, many investors doubt his ability to curb the bullish trend in long-term yields. The dollar has plummeted sharply since Bessent's announcement, as investors, concerned about rising inflation and U.S. public debt of $40 trillion, have rushed into "devaluation" operations, buying alternative wealth reserves such as Bitcoin and gold.

Bessent's interventions are unlikely to address the fundamental vulnerabilities, according to Matt King, founder of Satori Insights. The market is returning to "devaluation" operations, said Eoin Walsh, head of TwentyFour AM. The devaluation strategy, where operators buy assets expected to protect against dollar and other fiat currency devaluations, suffered a serious setback after the U.S. launched a war against Iran in early 2022, causing inflation to rise and push up short-term Treasury bond yields, strengthening the dollar.

Bullish sentiment towards devaluation has returned, following the war with Iran, but now the focus is back on devaluation. A commodities broker noted that the devaluation strategy has been hit hard since the U.S. launched its war against Iran, which increased inflation and boosted short-term Treasury bond yields, supporting the dollar.

The volatility and unpredictability typically translate into higher premiums, explaining part of the dollar's depreciation. Chris Turner, chief global market analyst at ING, suggests that Bessent's intervention aims to stabilize the bond market and address the risk of a massive sale of U.S. long-term debt. Some analysts suggest that the dollar's depreciation reflects a loss of credibility in U.S. policy-making.

However, Turner believes that what we are witnessing is the U.S. Secretary of the Treasury showing great interest in the long-term Treasury bond segment.