QCP: Japanese Bond Market Volatility and Escalation of US-EU Tariff Conflict Drive Market into Safe Haven Mode, Bitcoin Under Pressure and Falls

**Jan 21 – QCP noted in its latest daily market analysis that global risk appetite has cooled sharply over the past week, with Japan’s bond market volatility and geopolitical tensions driving capital toward safe havens.** U.S. stocks at one point dropped more than 2%, while the global bond market faced simultaneous pressure. Japan has emerged as the center of current market anxiety. After years of ultra-low rates, its 10-year government bond yield has climbed to ~2.29%—a 1999 high—exposing severe fiscal fragility. Japan’s public debt exceeds 240% of GDP (total ~¥1,342 trillion), and debt interest payments are projected to make up ~25% of fiscal spending by 2026. The yield surge has sparked widespread doubts about the sustainability of Japan’s finances, with spillover effects on global bonds. U.S.-Europe ties have also grown tense again. The Trump administration imposed a 10% tariff on eight European countries opposing U.S. attempts to control Greenland, with plans to hike the rate to 25% by June 1. The EU quickly vowed retaliatory steps, raising risks of further trade escalation. Bilateral goods trade hit $650B-$700B in 2024, so escalating tensions could have major impacts. The European Parliament is also weighing suspending the U.S.-EU trade deal struck in July this year. Against this backdrop, Bitcoin remains under pressure after falling below $90k, though it briefly topped $97k earlier. Momentum has yet to rebound, however. QCP noted BTC now acts more like a high-beta risk asset than a safe haven, with high sensitivity to interest rates, geopolitics, and cross-market swings. Until policy signals clear up, the crypto market may still react passively, with capital shifting to preservation over risk-taking.