Jerome Powell Makes Crucial Statement for Crypto Market: Details

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Fed chairman Jerome Powell's recent comments might have significant implications for cryptocurrencies

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At the start of the year, investors expected the Fed to begin cutting in March and continue until it cut six or seven times this year. The first cut is now expected to occur in June, with four reductions totaling a full percentage point by the end of 2024.Riskier assets, like cryptocurrency, fell in 2022 as investors sought higher returns elsewhere after central banks raised interest rates.

While the end of rate hikes was positive for cryptocurrencies, Fed officials have indicated that rates might not fall soon. Powell stated in congressional testimony this week that inflation is falling, but not to the point where the Fed is ready to cut rates.Expectations of subdued inflation and lower interest rates have fueled the advance on financial markets, so a delay in the Fed's expected interest rate decreases could derail the positive narrative.

 

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