- The price of Bitcoin showed a sudden drop, falling to $26,630.
- According to recent data, the BTC/USD pair is trying to regain focus in the short-term trading range.
- Fed Chairman Powell mentioned inflation in his speech and reiterated the view that inflation is still above their targets.
Fed Chairman Jerome Powell’s statements caused sudden movements in the markets. Here are Powell’s critical statements!
Fed Chairman Powell Spoke; Bitcoin Fell!
Bitcoin rose to $27,000 after the Chairman of the United States Federal Reserve made comments about policy. According to recent data, the BTC/USD pair is trying to regain focus in the short-term trading range.
CANLI | #FED Başkanı Powell: “Enflasyon, FED hedefinin çok üzerinde.”
— CO NEWS (@coinotag) May 19, 2023
Fed Chairman Powell mentioned inflation in his speech. He reiterated the view that inflation is still above their targets. Powell’s other important statements are as follows:
- High inflation creates significant challenges.
- The banking system is strong and resilient.
- Due to tightening credit conditions, the policy rate may not need to be raised as much as previously thought.
- We know that high inflation reduces purchasing power. We have not deviated from our 2% target.
- I think supply chain problems will continue. No matter how many supply chain problems there are, price stability is the foundation of a strong economy and it is the responsibility of the central bank to maintain it.
During these statements, news came that US Treasury Secretary Janet Yellen told bank CEOs to be ready for more mergers. The news boosted Bitcoin and Gold, but Powell’s speeches continued to push the markets down.
The price of Bitcoin showed a sudden drop, falling to $26,630. Gold, on the other hand, showed a slight drop, falling from $1984 to $1973.
The US Dollar index showed a sharp drop when the speech began, and this drop deepened with Janet Yellen’s statement. DXY showed a 0.41% drop.
Expectations for Interest Rates Have Fallen
Expectations for the Federal Reserve’s interest rate meeting on June 14, 2023, were shaped during these speeches.
The probability of interest rates remaining unchanged for the meeting on June 14th was 80.4%. The probability of interest rates increasing by 25 basis points was 19.6%. According to FedWatch, the probability of interest rates being lowered is currently 0%
At the last interest rate meeting on May 3rd, the Fed raised interest rates by 25 basis points. Prior to that, at the interest rate meeting on March 22nd, they also raised interest rates by 25 basis points. Investors have been waiting for the Fed to stop raising interest rates for a long time, but the Fed has continued to raise interest rates.
