The risk of U.S. fiscal dominance with the monetization of government debt by the Federal Reserve is growing, and such a scenario should be supportive for cryptocurrencies as investors seek out alternative assets, investment bank Standard Chartered said in a research report on Tuesday.
Donald Trump could also be a boon for cryptocurrencies. 'We think that a second Trump administration would be broadly positive via a more supportive regulatory environment,' the report said.
U.S. fiscal dominance would likely have three effects on the U.S Treasury curve: 'a steeper nominal 2 year/10 year curve, a greater increase in breakevens than real yields, and an increase in term premium' Kendrick said...
If Trump were to win the election a second administration could accelerate the withdrawal of foreign official U.S. Treasury buyers due to fiscal concerns, the bank said...
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