$100 Oil Sets Stage for Fed Rate Hike, Crypto Enters Defensive Consolidation

A recent surge in oil prices pushed the US 10-year Treasury yield above 4.8%, its highest level in three years, and brought a September Federal Reserve rate hike back into focus.

The Labor Department reported a stronger-than-expected August jobs report, which added to inflation concerns and increased pressure on the Fed to tighten monetary policy further.

Brent crude oil prices briefly surpassed $100 per barrel for the first time since July, exacerbating inflation fears and pushing long-end bond yields higher.

The market is now pricing in a rate hike from the Fed in September, with the US 10-year Treasury yield at its highest level since 2019. However, CoinEx Research believes that oil prices are the key driver of cross-asset pricing in Q4 and that a pullback in oil would be necessary to relieve inflation expectations and rate pressure.