- Shiba Inu (SHIB), Cardano (ADA), XRP and other altcoins experienced a brief surge during Federal Reserve Chair Jerome Powell’s speech, before losing some gains.
- Powell dismissed concerns about “stagflation,” contradicting JPMorgan CEO Jamie Dimon’s warning that the US economy might be heading back to the 1970s.
- Interest rate futures are betting on a single rate cut in 2024, with the first expected in September.
Explore the recent surge in altcoins during Federal Reserve Chair Jerome Powell’s speech and the potential implications of his comments on the future of cryptocurrency.
Altcoins Surge During Powell’s Speech
During a recent speech by Federal Reserve Chair Jerome Powell, several altcoins including Shiba Inu (SHIB), Cardano (ADA), and XRP turned green, indicating a surge in their value. However, these gains were short-lived as the cryptocurrencies soon gave up some of their gains.
Powell Dismisses Stagflation Concerns
In his speech, Powell dismissed market concerns about “stagflation,” a scenario in which slow economic growth is coupled with high inflation. This contradicts earlier warnings by JPMorgan CEO Jamie Dimon about the US economy potentially heading back to the 1970s. American businessman and investor Jeffrey Gundlach expects only a single rate cut this year, contradicting Powell’s predictions.
Future Interest Rate Cuts
Powell stated that future rate cuts could come sooner due to an unexpected weakening in the labor market. However, the decision will still hinge on the incoming inflation data. Powell has stressed that the Fed is now satisfied with inflation staying at 3%. The Fed’s goal is to bring inflation back to 2% before it would be able to start cutting rates.
Cryptocurrency Market Impacted by Fed’s U-turn
The cryptocurrency market has been hit hard by the Fed’s U-turn, with Bitcoin logging its worst monthly candle since August 2023. The Fed was previously predicted to implement at least three rate cuts this year. Interest rate futures are now betting on a single rate cut in 2024, with the first expected in September.
Conclusion
The recent surge in altcoins during Powell’s speech and his comments on stagflation and future interest rate cuts have significant implications for the cryptocurrency market. Investors should keep a close eye on these developments as they could impact the value of their investments.
