Impact on each asset
USD ▲US dollarTailwind
XAU ▼GoldHeadwind
US ▲US stocksTailwind
SET ▼Thai stocksHeadwind
BTC ▼CryptoHeadwind
Summary
After the Fed's first rate hike in three years to 3.75%–4.00% in May 2026, markets now price only a 16% chance of a hike in October, but 92% for December. The 10-year yield stands at 5.07%, rising to 5.14% on dollar strength and oil gains.
Why it moves markets
The market is repricing the frequency of tightening for year-end even as the Fed holds. Higher yields and a firmer dollar weigh on gold and risk assets requiring lower discount rates, and hurt SET and emerging currencies as capital rotates to USD.
Similar past event: The Fed starts its steepest hiking cycle in 40 years (Mar–Dec 2022)
In a rising-rate cycle the dollar is usually the winner, while assets that rely on cheap money (growth stocks, crypto) tend to struggle. When the Fed keeps signalling tightening, be careful trading against the dollar trend. See details
In a rising-rate cycle the dollar is usually the winner, while assets that rely on cheap money (growth stocks, crypto) tend to struggle. When the Fed keeps signalling tightening, be careful trading against the dollar trend. See details
Deeper view and what to watch
This echoes fed-2022 when the Fed started a strong hiking cycle, but differs in that this comes after a 50bp cut in September 2024 (cut-2024). Markets are repricing assumptions of sustained Fed hawkishness. If tightening continues through November and December, gold and rate-sensitive equities face renewed pressure.
For education only, not investment advice. Prices and figures change constantly, so check the sources before making decisions.