Bloomberg TV Interview: Bilal Hafeez on AI Rebound, Fed Policy, and Japanese Yields

Bilal Hafeez, Head of Market Strategy at Macro Hive, identifies the ongoing AI revolution as a multi-year structural rebuild of global architecture, suggesting that recent market corrections offer buying opportunities rather than a thesis unraveling. Beyond tech, a significant mispricing exists in Japan, where interest rates remain artificially low despite rising inflation and debt, likely forcing at least one rate hike this year to stabilize the yen. While the carry trade remains persistent due to market uncertainty, the Federal Reserve appears hesitant to hike rates further, relying on soft data to maintain a dovish stance. However, a potential crisis of confidence could emerge if long-term yields break out alongside falling equities, forcing the Fed to hike to re-establish inflation credibility. Current credit spread widening in AI-related plays reflects market indigestion from massive issuance scales rather than a precursor to a systemic crisis.