Interest Rates: Hikes Or Cuts?
– President of the Federal Reserve Bank of Philadelphia, Patrick Harker, is doubtful of interest rate cuts until 2024.
– Harker does not see the need for further rate hikes at the moment.
– The current market sentiment expects the central bank to maintain the current target rate of 500 to 525 bps.
– Harker’s outlook could change if inflationary pressures don’t continue to cool down.
– The Federal Open Market Committee (FOMC) meeting is scheduled for September 20, 2023.
Impact On Crypto Asset Prices
– The post-pandemic US Fed decisions have been largely restrictive.
– Bitcoin price has shown bearish signals in response to rate hikes.
– Traders have sometimes preferred investing in the crypto market during high volatility in traditional financial markets.
– The possibility of a few more rate hikes already priced in for upcoming FOMC meetings may not have a significant impact on Bitcoin price.
Hot Take
President Harker’s doubt about interest rate cuts until 2024 suggests that the Federal Reserve is cautious about the state of the US economy. The focus on cooling inflationary pressures may impact the decisions of the upcoming FOMC meeting. However, the impact on the crypto market, especially Bitcoin, may be minimal as traders have shown a preference for investing in cryptocurrencies during times of high volatility in traditional markets.
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