In one year, bitcoin has gained +128%. The hodlers are ecstatic. Analysts are also jubilant: their bull run predictions are about to come true. And to top it all off, FED Chairman Jerome Powell announced thatno increase in interest rates will occur before the end of the year. And that’s good for bitcoin.
FED, the end of key rate hikes?
For stem inflation, the American Federal Reserve (FED) found it useful to raise its key rate several times. In mid-June, this rate was between 5 and 5.25%. At that time, Jerome Powell, the head of this institution, said that there will probably be two additional increases until the end of the year.
“ The FED suggests there will be no further rate hikes in the future: analysts are bullish on Bitcoin at $40,000 this month. »
Last Friday, Jerome Powell spoke on the current state of the American economy and inflation during his visit to Spelman College in Atlanta. On occasion, he led his listeners to believe that the FED does not foresee any upward revision of its interest rate by the end of the year. Thus, there is very little chance that the next meeting of the Federal Open Market Committee (FOMC) in mid-December will result in a further increase in the key rate.
“ The FOMC is firmly determined to bring inflation down to 2% over time and maintain restrictive policy until we are satisfied that inflation is on track to achieve this goal », reports Cointelegraph.
However, Mr. Powell preferred to play the cautious card by asserting that:
“ It would be premature to conclude with certainty that we have reached a sufficiently restrictive position, or to speculate on when the policy might be relaxed “.
Will this have consequences on the price of bitcoin (BTC)? Apparently yes.
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