Federal Reserve Chairman Jerome Powell rejected the possibilities of interest rate cuts any time soon. However, the crypto market remained resilient amid these macroeconomic developments. Bitcoin continued to trade above $105,000 today.
On Tuesday, June 24, Powell reported to the U.S. Congress on how the economy is doing. He said that things are okay, but there is a certain amount of concern, particularly regarding how Trump tariffs may raise the cost of ordinary items, known as inflation.
Powell also indicated that the Federal Reserve is cautious and observing the turn of events before it makes its decision on whether to adjust interest rates (the cost of borrowing money). In essence, they do not want to make a decision too early.
The U.S. Federal Reserve has, however, maintained its benchmark interest rate at 4.25%-4.50% citing that there are still inflation risks and economic uncertainty. Fed Chair Jerome Powell has indicated that there is no imminent rate cut despite increased political pressure and downward growth expectations, saying the policy is to be data-dependent and cautious.
In the meantime, Trump and certain individuals within his staff are angry at Powell since they want the Fed to reduce the interest rates in order to stimulate the economy, and Trump went online to say some nasty things about Powell.
Powell got strong criticism from President Trump, who has urged the Fed to make aggressive cuts to stimulate the economy. Trump called Powell a stupid person and said the Fed’s position is killing growth, particularly in areas such as housing, where permits and starts are at multi-year lows. However, the Fed is still independent, and policymakers are split but eventually converging to keep rates unchanged at present.
In spite of the absence of a dovish pivot of the Fed, the key cryptocurrencies have demonstrated impressive stability. Bitcoin is still trading around the $105,000 mark and the rate announcement has had little impact on the price. According to analysts, though rate cuts have generally served as a bullish catalyst to digital assets, the current stable policy has prompted a more conservative, capital-conservation strategy by investors.
Is the next action of the Federal Reserve affecting the prices of cryptos? The answer is yes, and traders are keeping an eye. Everyone is now focusing on the next speech of US Federal Reserve Chair Jerome Powell. Any dovish undertone, particularly the indication of potential rate cuts, may drive Bitcoin above its existing resistance levels.
Also Read: Fed Chair Powell Gives Green Light for Banks to Enter Crypto
