Fed Chairman Powell began making his anticipated presentation at the US Senate Banking Committee. This speech has been awaited for a long time. Because the statements affect the Bitcoin, cryptocurrencies and gold market. The FED President has just started making a statement and the markets are moving. As Kriptokoin.com, we have compiled all the details for you, let’s examine the explanations together… The article will be constantly updated with the new statements of the FED Chairman. Update the page constantly so you don’t miss the explanations!
FED Chairman Speaks! Bitcoin and Gold Affected!
Federal Reserve Chairman Jerome Powell attended Capitol Hill today for the first day of his six-month speech on monetary policy. Addressing a panel of congressional senate deputies, Jerome Powell assured that the central bank is committed to reducing inflation and will use all means to achieve that goal. Here are key notes from Powell’s speech:
- The peak level in interest may be higher than expected.
- We are ready to increase the pace of rate hikes if necessary.
- The final level of interest rates will likely be higher than previously anticipated.
- So far there is little evidence of deflation in basic services, excluding housing.
- Lower inflation in basic services excluding housing and a possible softening in the labor market are required for inflation to return to 2%.
- The labor market remains extremely tight.
- Inflation has softened, but its path may be volatile.
- The Fed will make policy decisions for each meeting.
- The peak level in interest may be higher than expected.
- Previous softening trends in hiring, spending and inflation data partially reversed in January.
- It will take time for the full effects of monetary policy to be reflected in wider areas.
- The strength of the economy indicates that the peak interest rate will be higher than previously anticipated.
- The latest economic data came in stronger than expected.
Bitcoin price fell below $22,000 with Powell’s statements. Gold price slipped below $1,823. In the swap market, the pricing that was 25 basis points for the FED’s March meeting increased to 50 basis points.
FED has signaled that it will continue to increase interest rates!
Federal Reserve Chairman Jerome Powell has made it clear that the Federal Reserve will continue to raise interest rates until we see clear indications that inflation is heading towards the Fed’s 2% target. In addition to promising to fight inflation, Powell stressed that the overall state of the economy is positive, with a strong labor market and ever-increasing demand. Powell stated that inflation is well above the 2 percent target and as the labor market remains extremely tight, the Federal Open Market Committee (FOMC) continued to tighten its monetary policy stance, raising interest rates by 4-1. Speaking of lowering inflation and then raising interest rates, Powell said:
Restoring price stability will likely require us to maintain a restrictive monetary policy stance for a while.
To achieve a monetary policy stance that is restrictive enough to bring inflation down to 2 percent over time, the Federal Reserve thinks further increases would be appropriate. In addition, the Fed is currently working hard to significantly reduce the overall size of its balance sheet.
Fed Chairman Powell’s main focus is inflation
FED Chairman stressed that price stability should be re-established; this will pave the way for maximizing employment and maintaining price stability in the long run. “We will stay on course until the job is done,” Powell added. After Powell finishes his statement, he will attend a question-and-answer session with senators from the United States. The US stock market slumped after the Fed Chairman’s statements, and key indexes such as the S&P 500, Dow Jones and Nasdaq 100 all fell by about 1%. The cryptocurrency market also suffered losses, with the price of Bitcoin dropping 2% in the past hour.
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