Bitcoin returns to $48,000 after FED president speech: no rush to raise interest rates
The president indicated that the US central bank is considering starting to withdraw some of its money-injection monetary policies by the end of the year, although it still sees interest rate hikes in the distance.
In short, the latest delay in tapering, as the debt purchase reduction process is known, means that the central bank will continue to inject liquidity into the markets; a measure that favors investments of riskier assets such as digital currencies.
The cryptocurrency market seemed to react positively to Powell’s remarks. Bitcoin returned to $48,000 right after the speech, and it continues to climb.
The main cryptocurrencies are also on the rise this Friday after starting the day in a downtrend.
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While the Fed could begin to phase out bond purchases before the end of the year, the president emphasized that economic progress will set the tone. Along these lines, Powell made sure to emphasize that reducing the policy would not determine the timing of an increase in interest rates.
The institution has previously contemplated an increase for 2023.
Despite the country’s progress, Powell reiterated that the Fed will maintain “the current level of interest rates until the economy reaches consistent conditions of maximum employment”.
He was also optimistic about the high inflation readings in recent months and said they were transitory. “Inflation at these levels is, of course, are a cause for concern. But that concern is tempered by a number of factors that suggest these elevated readings are likely temporary, “Powell said.