Bitunix Analyst: The pressure on US debt of $40 trillion heats up, the Ministry of Finance takes steps to reduce long-term bond yields, the dollar falls sharply, and BTC strengthens at the same time as gold

Comparatively, the US federal debt officially surpassed 40 trillion US dollars, and the monthly fiscal deficit reached 432 billion US dollars in July, while interest expenses on debt surpassed health insurance in the first 10 months before fiscal 2026, making it the second-largest federal budget item after social security spending. While the fiscal deficit still accounts for about 6% of GDP and the supply of long-term debt continues to increase, the problems facing US bond yields are not just inflation, but fiscal supply, government financing requirements, and term premiums are rising at the same time. At the same time, the Ministry of Finance announced an increase in the repurchase scale of 10-year to 30-year US bonds in an attempt to ease the upward pressure on long-term yields. This move improved bond market sentiment in the short term, and also reflected that the government is more sensitive to the pressure on financing costs brought about by high long-term bond yields.

The market quickly reflected this policy signal yesterday. DXY fell 0.9% to about 97.9, BTC surged 7.13% to $69,310, and gold rose 4.31% to 4,522 US dollars at the same time. The weakening of the US dollar and the decline in long-term yield rates have given room for repricing non-dollar assets and high-beta assets. The simultaneous strengthening of BTC and gold is particularly noteworthy.

However, it should be noted that the latest minutes of the Joint Committee meeting still show that many officials believe that if inflation does not continue to fall, interest rates may still be raised in the future, indicating that monetary policy has not changed to easing. As a result, yesterday's market was closer to the easing of financial conditions brought about by the Ministry of Finance's intervention in the long-term bond market and the repricing of the US dollar, rather than an interest rate cut transaction.

For BTC, the next key is whether the long-term yield rate of DXY and US debt can remain weak. If the US dollar continues to weaken and long-term bond yields stabilize, BTC is expected to continue this round of rebound; however, if inflation stickiness and $40 trillion debt push up maturity premiums again, US bond yields will rise again, putting renewed valuation pressure on the crypto market.