Federal Reserve (Fed) Chairman Jerome Powell’s speech at the Jackson Hole Symposium on Friday has the potential to trigger volatility for Bitcoin pric
price sustains above the key $25,000 level, broadly unchanged since the sharp decline seen on August 18 as investors appear to be cautious ahead of the key meeting, to be held between Thursday and Saturday.
Bitcoin investors are expecting interest rates to be higher for longer, partly explaining the selling pressure on the asset and its struggle to recover to the key psychological level of $30,000. If Powell asserts a hawkish message and reinforces expectations for additional rate hikes,However, a scenario in which Powell welcomes the slowdown in inflation and signals that interest rates don’t need to be lifted any more, would likely increase demand for risk assets, including Bitcoin.
A dovish stance from Powellcould act as a bullish catalyst for risk assets like Bitcoin and altcoins. An expectation of interest rate cuts in 2024 could further cement bullish hopes for the asset’s price rally post-halving.Monetary policy in the US is shaped by the Federal Reserve . The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates.
When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.The Federal Reserve holds eight policy meetings a year, where the Federal Open Market Committee assesses economic conditions and makes monetary policy decisions.
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