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After more than two and a half years of aggressive monetary tightening, the chairman of the US Federal Reserve announced Jerome Powell This is widely expected to indicate an imminent shift towards Easing monetary policy.
What happenedPaul is highly anticipated. Keynote Speech The Federal Reserve Bank of Kansas City's Jackson Hole Economic Symposium is scheduled for Friday at 10 a.m. ET, and Fed presidents have historically used the event to signal major changes in the central bank's policy, according to CoinDesk. Reported.
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Market participants have been preparing for this shift for some time, with traders already pricing in a 100% probability of at least a 25 basis point rate cut at the Fed’s next meeting in September.
This sentiment was reinforced after the release of the minutes of the Federal Reserve's July FOMC meeting, which revealed that a “substantial majority” of participants believe a September rate cut is “likely appropriate.”
Analysts expect Powell to not only confirm a September rate cut, but also take a cautious stance on further easing.
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This could mean that the Fed may cut interest rates by only 25 basis points in September, signaling to markets that a continuous series of cuts should not be expected in the near future.
In the run-up to the expected easing cycle, US financial markets have remained largely active.
Despite a brief dip from mid-July to early August, the S&P 500 is currently trading just about 1% below its all-time high reached in early July, while the Nasdaq is trading about 4% below its peak.
Gold also saw a rise, hitting a record high of $2,566 earlier this week.
The bond market appears similarly upbeat, with the yield on the 10-year US Treasury note falling to a multi-year low of 3.77%.
Read also: According to Cathy Wood, owning 6 Ethereum (ETH) could make you a millionaire, Here's why this could be true..
Why is this important: but, Bitcoin (CRYPTO: BTC) has been struggling to gain momentum.
Despite recovering from the early August sell-off that briefly pushed prices below $50,000, Bitcoin is still well below its all-time high of around $73,500, which it reached in March.
This weak performance is notable given other positive factors in the crypto space, including rising institutional interest and continued inflows into spot ETFs.
Moreover, Bitcoin may benefit from recent developments on the regulatory front.
According to an ABC News report, cryptocurrencies that are friendly to Robert F. Kennedy Jr. He is considering withdrawing from the presidential race on Friday. Republican Party Candidate Endorsement Donald Trumpalso known as positive attitude Towards cryptocurrencies.
On the Democratic side, a senior official said, Kamala HarrisThe Harris campaign has indicated that her administration will be More support The crypto industry is more sophisticated than the current Biden administration.
Next Gasoline The Future of Digital Assets The event on November 19 will be of particular importance in this context.
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This article If Jerome Powell signals interest rate cut on Friday, what does that mean for cryptocurrencies? Originally appeared on Benzinga.com
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