Under the premise of unclear policies, the alt season will be a long way off: US banks warn about tariffs and economic outlook.

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In the context of the current complex and volatile global economic situation, policy uncertainty has become one of the key factors influencing market trends. Particularly in the cryptocurrency market, this uncertainty is amplified, making the so-called "alt season" (referring to a period of active altcoins) difficult to arrive. Meanwhile, the analysis of tariff policy by U.S. banks further reveals the potential risks in the global economy and financial markets.
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The negative impact of tariff policies
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Analysts at Bank of America pointed out that the negative impact of tariff policies on the US economy and the dollar is more significant than that on other countries and currencies. Their core viewpoints include the following aspects:
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1. Retaliatory tariffs and trade imbalance
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The United States frequently adopts tariff measures in an attempt to protect domestic industries, but this unilateral behavior has triggered retaliatory tariffs from other countries. Due to the United States' large scale in global trade and its high degree of reliance on global trade, these retaliatory tariffs have a more significant impact on the U.S. economy. In contrast, other countries have a relatively smaller trade scale with the U.S., and therefore the impact they face is relatively limited.
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2. Corporate investment and hiring stagnation
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The uncertainty brought about by tariff policies has led to a stagnation in hiring and investment plans among American companies. Concerns over future trade policies have made businesses more cautious in expanding production, increasing investments, and hiring employees. This stagnation not only affects economic growth but may also lead to a soft labor market, which in turn impacts consumption and overall economic vitality.
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3. Monetary easing and rising borrowing costs
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Bank of America also pointed out that fiscal easing policies could further drive up borrowing costs. To stimulate economic growth, the U.S. government may adopt fiscal expansion measures, such as increasing public spending or cutting taxes. However, these measures could lead to a widening fiscal deficit, which in turn would raise borrowing costs. High borrowing costs will increase the financing burden on businesses, further suppressing investment and consumption, thereby creating downward pressure on economic growth.
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The uncertainty of the dollar's fate
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The impact of tariff policies on the US dollar cannot be ignored. As the world's primary reserve currency, the value of the dollar is influenced by a combination of factors, including economic growth, trade balance, interest rates, and policy stability. A report from the American Bank indicates that data will determine the fate of the dollar:
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1. The dual impact of economic indicators
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If the U.S. economic indicators perform strongly, investors may overlook the noise brought by tariff policies, thus supporting the dollar exchange rate. Strong economic growth data, low unemployment rates, and high inflation rates may attract international investors to purchase dollar-denominated assets, further driving up the value of the dollar. However, U.S. Bank expects that due to the negative impact of tariff policies, U.S. economic data may be relatively weak.
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2. Weak data and the risk of dollar depreciation
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Analysts at American banks believe that the uncertainty of tariff policies has already had a negative impact on economic growth. Policy uncertainty has led to a stagnation of business investment and hiring plans, while the continued high tariffs have also increased the operating costs for companies. These factors could lead to a slowdown in U.S. economic growth, which in turn could weaken the value of the dollar. If economic data continues to be weak, investors may lose confidence in the dollar and seek other safer assets, such as gold or yen.
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The "alt season" in the cryptocurrency market is still a long way off.
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Under the premise of unclear policies, the "alt season" in the cryptocurrency market will also be difficult to arrive. Altcoins (referring to cryptocurrencies other than Bitcoin) usually perform actively when market sentiment is optimistic, funds are abundant, and policies are relatively stable. However, the current uncertainty in the global economy and financial markets has made market sentiment cautious, with funds flowing towards more conservative assets, naturally suppressing the activity of altcoins.
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1. Market Sentiment and Capital Flow
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The uncertainty of tariff policies and the instability of the global economy have made investors more cautious. Funds are flowing towards more conservative assets, such as government bonds and gold, while shying away from the high-risk cryptocurrency market. This trend has significantly reduced the activity of altcoins.
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2. Strengthening of policy regulation
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Governments around the world are also continuously strengthening regulatory policies on cryptocurrencies. Under the premise of unclear policies, investors' confidence in the cryptocurrency market is insufficient, further suppressing the market performance of altcoins.
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3. The hedging properties of Bitcoin
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In the current market environment, Bitcoin's safe-haven attributes are relatively more prominent. Investors are more inclined to hold Bitcoin rather than other altcoins. This trend has also led to a more sluggish market performance for altcoins.
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Conclusion
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The analysis of tariff policies by American banks reveals potential risks in the global economy and financial markets. The uncertainty of tariff policies has had a negative impact not only on the US economy and the US dollar but also on the cryptocurrency market, leading to far-reaching effects. Under the premise of unclear policies, the "alt season" in the cryptocurrency market will be a distant prospect. Investors and policymakers need to closely monitor global economic conditions and policy dynamics and adopt flexible strategies to cope with uncertainty.