Bloomberg identifies several macro forces that have pressured risk assets and driven declines across global equities and major cryptocurrencies.

Shock from Japan

The Bank of Japan signalled a potential rate increase on 19 December, surprising markets and prompting rapid yen appreciation.

The stronger yen forced a unwind of carry trades and triggered repatriation of Japanese capital, reducing liquidity in overseas markets.

Yields on Japanese government bonds rose to levels last seen in 2008, making domestic assets relatively more attractive for investors.

Awaiting US macro data

Investors are withholding risk ahead of this week’s US releases, including consumer spending, labor market figures and the ISM index.

Large funds prefer to await concrete data before increasing exposure, which contributes to muted market activity and wider risk aversion.

Federal Reserve uncertainty

Markets are pricing in uncertainty ahead of the Fed meeting on 10 December, including discussions about senior leadership and future policy steps.

Even where rate cuts are anticipated, investors tend to defer positioning until official guidance and votes are clear.

Cooling of the AI-driven rally

Technology stocks have corrected after rapid rerating, with elevated spending and valuation pressures weighing on sector momentum.

The MSCI Tech index moved into negative territory for the first time in 7 months, reflecting a broader reassessment of growth expectations.

Weakness in China

China’s manufacturing sector has contracted again, extending headwinds across Asian markets and increasing global investor caution.

Signs of slower activity in China reduce demand outlooks and amplify downside risk for commodity-linked and export-oriented equities.

Cryptocurrency follows macro trends

Bitcoin and ether declined alongside equities, with BTC slipping below $86 000 and ETH dropping under $3 000.

Bloomberg notes that there is no distinct problem in crypto infrastructure; price moves reflect a broader shift to risk-off sentiment after the macro shocks.