Last night, the crypto market experienced a roller coaster market. The global capital market was watching the interest rate policy of the Federal Reserve, and the capital market also experienced large fluctuations.
The Federal Reserve Board of the United States announced the latest interest rate decision on June 12, local time, maintaining the target range of the federal funds rate at 5.25% to 5.50%, which was in line with market expectations.
The market rose due to this news, with both Bitcoin and Ethereum rising by more than 5%. Bitcoin hit the $70,000 mark, and altcoins also rose sharply.
Subsequently, Federal Reserve Chairman Powell spoke. He believed that more recent inflation data had slowed down, and more good data was needed to boost confidence in the anti-inflation process. He continued to pay close attention to inflation risks. So far this year, our confidence in inflation slowing down enough to cut interest rates has not increased. Powell said that the entire interest rate path is important, not just the first rate cut. The first rate cut is crucial to the economy, and the timing of the rate cut is an important decision for the economy.
Then the market turned down, Bitcoin fell to $67,000 again, and the altcoins pulled back one after another.
The interest rate was cut once in November, and the crypto market rose; Powell said that the interest rate cut would take longer, and the crypto market plunged again.
Now the big fluctuations in the currency circle all depend on the Fed. The impact of the interest rate cut in the second half of the currency circle is unlikely to be great. Whether the Fed directly expands the balance sheet to print money is the key to driving the second wave of the market, but the Fed's direct expansion of the balance sheet to print money often leads to a recession and a sharp drop in the market. The Fed has given up on foresight, followed the data step by step, and did not give a clear policy. It seems very cautious. The market hesitated about this, and then wanted to see one or two more months of data to see if inflation really reversed the rebound trend in the first quarter.
From the fact that $70,000 has not been able to break through effectively, it shows that there is not much net capital entering the market, and the altcoins have fallen particularly sharply, and have even completely fallen back to this round of gains. Institutions are busy cashing out on altcoins and arbitrage on Bitcoin, so there is no large inflow of funds into the crypto market to drive a second surge. It is more likely to fluctuate in a large range, which requires more patience and wait for new events or data to stimulate the trend.
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