Warren is calling on the Federal Reserve to lower interest rates, a move that could have a significant benefit for the crypto market.
In an unexpected development, Senator Elizabeth Warren called on the Federal Reserve to reconsider its current interest rate policy. In a letter to Fed Chair #JeromePowell , Warren noted that the current 5.5% rate not only slows the economy but also contributes to persistent inflation levels running above 3%. This call was also signed by Senator Jacky Rosen.
The letter details that higher interest rates increase costs in key sectors such as home and auto insurance, which contribute greatly to the overall inflation rate. Citing a report from Bankcreek Capital Advisors, he argues that lowering interest rates would ease financial pressure on Americans and reduce their basic monthly expenses, especially housing costs.
This would be in line with other major economies that have recently lowered interest rates, such as the United States, Canada and the European Union. Additionally, they have lowered their rates in countries such as Sweden, Switzerland, Hungary and the Czech Republic.
As the Federal Reserve prepares for its upcoming interest rate decision, the crypto community is watching carefully. Traditionally, the Fed has indicated its intention to maintain high rates for an extended period of time. Following its last meeting, the Fed said it would not consider a rate cut unless there was more consistent evidence that inflation was moving more steadily toward the desired 2% level.
However, recent job growth and low unemployment rates provide a rationale for the Fed to maintain current rates. According to CME FedWatch, the market is 99% certain that there will be no change in rates at the June meeting. Interest rate cut speculations are shifting to later periods of the year, probably in September or November.
