The Gold market is looking strong

A0 Financial

Date: 12/4/2023

(Not Financial Advice)

Treasury Notes

The yield curve has been reverting, and looks like investors are pricing in that the Fed is done with rate hikes. 2-year notes and 10-year notes have been falling as well. Investors are getting ahead of themselves because even if the Fed is done hiking, it doesn’t mean the Fed will cut. In fact, rates could stay at these levels for the next six months to a year. If the Fed doesn’t cut the narrative immediately, this can cause inflation to rise once again.

Repo Market

The repo market, which is the overnight liquidity of banks, is quickly falling, which usually signals future market volatility. In the case of large withdrawals, banks won’t have enough liquidity to account for the demand for withdrawals. The Fed also continues its quantitive tightening, selling assets off their balance sheets.