Analysis: Concerns Grow Over US Debt and Fiscal Deficit, Bitcoin Under Pressure Retreats, Market Awaits Powell's Possible Intervention in Bond Market

BlockBeats News, September 2nd, according to Forbes report, Bitcoin has retraced nearly 10% since breaking above $81,000 last month, with the price falling to around $76,000. As concerns about U.S. debt, fiscal deficits, and global financial market turbulence have escalated, the cryptocurrency market has seen increased volatility. Investors are now focusing on U.S. Treasury Secretary Besent's possible intervention in the bond market.

Ed Yardeni, President of Yardeni Research, stated that market concerns over the "bond vigilantes" are driving up yields to express dissatisfaction with massive government deficits, growing debt, and rapidly rising interest costs. He expects that if the U.S. 10-year Treasury yield reaches 5%, there will be strong demand in the bond market, potentially including intervention from Besent. If necessary, Besent may raise funds by issuing short-term bonds and then use them to repurchase long-term bonds to prevent a sell-off panic in the bond market.

Last month, Besent unexpectedly promised to support the bond market to lower government borrowing costs, a move that subsequently propelled the price of Bitcoin significantly. However, this week global bond yields surged again, with the U.S. 10-year Treasury yield spiking to 4.814% at one point, reaching a new high since November 2023. Meanwhile, concerns about a potential escalation of U.S.-Iran tensions have pushed international oil prices back to around $90 per barrel, increasing funding costs for the U.S. and other major economies. This has further drawn market attention to Besent's potential next steps.