BlockBeats News, July 24th. The global market is no longer just enduring the escalation of tensions in the Middle East, but also witnessing simultaneous changes in energy supply, monetary policy, and global fund flows. The United States continues to escalate its military pressure on Iran, with B-1 bombers deployed, Trump considering larger-scale military action, and Houthi rebels threatening Red Sea shipping again. This has placed both the vital energy transit points of the Strait of Hormuz and the Red Sea at risk. Following Brent crude oil's surge above $100, the market has begun to reprice global inflation risks, rather than merely reacting to a one-off geopolitical event.

What is truly noteworthy is that the rise in oil prices has started to alter the policy calculus of central banks worldwide. The US initial jobless claims once again fell below expectations, indicating the labor market's resilience and alleviating the immediate need for the Fed to ease its policy. On the other hand, the surge in energy prices has reignited inflation expectations, driving up US Treasury yields across the board. Market bets on a rate hike in September or even earlier have rapidly increased. With the Fed removing forward guidance, the market is no longer waiting for the Fed to provide answers but is preemptively pricing in the policy path. This significant interest rate volatility implies that elevated funding costs might persist longer than initially anticipated.

This pressure is not exclusive to the US. While the European Central Bank remains on hold, it has made clear the room for a rate hike in September. In Japan, the US Treasury directly called out the yen for being significantly undervalued, urging the Bank of Japan to continue normalizing monetary policy. Japan's inflation rise and higher yields have prompted a reassessment of the possibility of a rate hike in Japan and the repatriation of funds by large institutions. Once Japanese funds start reducing their overseas allocations, it could not only weaken the demand for US Treasuries and stocks but also further tighten global USD liquidity.

In addition, the US has simultaneously expanded its tariff measures, reinstating a 10% to 12.5% import tariff system on around 60 economies. This has led to a simultaneous increase in energy costs and trade costs. This indicates that the market will not only face oil price fluctuations in the future but also rising supply chain costs, tariffs, and energy prices collectively driving up corporate operating costs. This will make it easier for global inflation to trigger a second-round transmission and further heighten the necessity for central banks worldwide to maintain a high-interest-rate policy.

For the crypto market, the primary source of pressure is no longer just geopolitics but the simultaneous tightening of global real interest rates and USD liquidity. The rise in oil prices has raised inflation expectations, driven yields to record highs, major central banks are reconsidering rate hikes, and Japanese funds may flow back domestically, indicating that risk assets will face a more substantial funding cost challenge. In the short term, market volatility will continue to revolve around the Middle East situation and central bank policies globally. The key determinant of the subsequent asset price direction will be whether energy prices can sustain their high levels and if high-interest rates gradually evolve into a new norm for the global financial markets.