Bank of America strategists are reportedly saying that a change in the macroeconomic landscape could be the catalyst that sent crypto markets to higher prices.
According to Reuters, analysts of the banking giant sent a new note to customers warning that accelerating inflation and slowing global economy could spread to US markets. Analysts say a worsening economy could force the Federal Reserve to tighten monetary policy to control persistent inflation, which could put massive selling pressure on stocks and traditional assets.
BofA chief investment strategist Michael Hartnett reports
“The ‘inflation shock’ is getting worse, the ‘rate shock’ is just beginning, the ‘recession shock’ is coming.”
Hartnett added that in such an environment, cash, volatility, commodities and crypto could become the most attractive assets for investors, outpacing both the stocks and bond markets. Earlier this week, the Federal Reserve released meeting minutes confirming that Fed officials agreed that raising the federal funds rate would be necessary to curb inflation.
Last month, Bloomberg commodity strategist Mike McGlone said that a potential recession could be bullish for Bitcoin. According to the analyst, BTC is transitioning from a risk-free asset traded alongside technology stocks to a risk-free asset that investors use to store value in times of economic uncertainty.
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