Powell's Remarks Shakes Crypto Market Again
Federal Reserve Chair Jerome Powell has hinted at a potential rate cut this September during a recent press conference. Powell indicated that the economy is nearing a point where a reduction in the current policy rate could be justified. He emphasized that decisions will be based on broader data trends rather than isolated data points.
Although there was some discussion about the possibility of a rate cut as early as July, the Fed opted to postpone the decision until their next meeting, with Powell confirming that the choice was unanimous. The central bank is closely monitoring labor market conditions, noting that current data suggests a stabilizing job market. Powell acknowledged that there was significant debate over the timing of the rate move at the recent meeting.
The Fed likely avoided a surprise July rate cut to prevent triggering inflationary pressures. Following Powell's dovish comments, the likelihood of a September rate cut is now at 93.5%.
Galaxy Digital CEO Mike Novogratz has highlighted rate cuts as a positive factor for Bitcoin in 2024. While Powell did not dismiss the possibility of multiple rate cuts this year, he also warned that the Fed might maintain current rates throughout the year.
Despite the potential for an upcoming rate cut, Bitcoin has fallen below the $65,000 mark. The cryptocurrency is facing renewed selling pressure, exacerbated by Mt. Gox transferring approximately $3.3 billion worth of Bitcoin earlier today.
