Fed Officials Express Hawkish Stance Amid IMF Warnings
U.S. Federal Reserve officials have made hawkish comments, emphasizing the need for further interest rate hikes to control inflation. This comes after the International Monetary Fund (IMF) warned of inflation and slower economic growth in 2024, advising central banks to maintain tight monetary policies. However, these remarks could potentially hinder Bitcoin’s post-halving rally as investors remain cautious about macroeconomic factors affecting its upward momentum.
Fed Officials Indicate Potential Rate Hikes
Several Federal Reserve officials have suggested that the central bank may not increase its benchmark interest rate beyond its current 22-year high. Neel Kashkari, President of the Minneapolis Federal Reserve Bank, stated that if the economy becomes too strong, further rate hikes may be necessary. Additionally, San Francisco Federal Reserve Bank President Mary Daly believes that the neutral interest rate should be higher now compared to during the pandemic, indicating a potential need for prolonged rate hikes.
US Treasury Yields Stabilize
US Treasury yields have experienced a decline following recent statements by Fed speakers such as Mary Daly. These comments have reassured investors that rates will not need to be raised due to a recent surge in bond yields. On another note, Federal Reserve Governor Michelle Bowman has suggested that interest rates may need to rise further and remain higher for a longer duration to combat inflation.
Potential Impact on Bitcoin
Bitcoin’s price has seen a 1% decrease in the past 24 hours and nearly 2% over the week, currently trading at $27,127. However, it is important to note that Bitcoin’s price has significantly risen since the beginning of this year. With the possibility of a bounce in the U.S. Dollar Index and potential corrections in Bitcoin, there is an expectation that the price will bounce back from the $26,500 level. Despite weak technical patterns and indicators, a drop to $25,000 appears less likely due to neutral sentiment and whales seeking entry points before the Bitcoin halving.
Hot Take: Varinder’s Insights
Varinder, an experienced professional in the fintech sector with a focus on blockchain and crypto, believes in the immense potential of these innovative technologies. While the author shares their knowledge through various media platforms, it is important for readers to conduct their own market research before investing in cryptocurrencies. The author and publication do not bear responsibility for any personal financial losses.
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