Jerome Powell aims for +50 basis points

Powell spoke, down the markets. A story we’ve seen repeating over and over again over the past few months, with a boss Federal Reserve Which now embodies the horror for those who work not only on cryptocurrencies, but also on other financial markets.

However, it’s not directly the loved one’s fault (at least now) Powell If the markets decide to back off every sentence he says in public. And let’s add an anti-current opinion, the fact that there was a short dip, in small proportions in our opinion, is not so bad.

Bitcoin, Powell and Inflation: What’s Going On in the Markets?

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Inflation: 50 basis points seems to be the most realistic fact, or it may not be

Yesterday the markets witnessed a important misunderstandingOr rather, in our opinion, cryptocurrency analysts who are not very familiar with the behavior of the markets compared to forecasts have tried it. It became certain yesterday that mayo or even Junefor the next meeting of Federal Open Market Committeethey will be on Table The interest rate increases by 50 basis pointsor the 0.50%. Something at least in our opinion that the markets have cut it significantly.

There were, at least in our opinion, other considerations that helped the markets offload the bulk of riskier stocks — and thus too Bitcoin Hence the rest of the cryptocurrency market.

  • Inflation peaked, or maybe not

Powell hinted for the first time that the consensus within the Fed was that inflation peaked in March – and so we were already left behind. But then, in a relatively schizophrenic communication style we are already accustomed to, he asserted that in fact it was not yet clear whether this was true.

  • “We will use all our tools to bring inflation back to 2%.

It is a decision-making step by feed itHowever, at least in our opinion, it is hard to believe. The balance sheet It remains just as out of control as inflation. and me 50 basis points Listed as possible doesn’t quite sound like a treat for horses.

Here we have already talked about the effects of inflation on the cryptocurrency world, effects that are largely due to reactions from major central banks.

How worried is there?

In our opinion Littlesince worst case scenarioThis is the worst possible scenario $0.50 In May or June. very condition indeed smoothDespite yesterday’s relatively mixed reactions from the markets, that should make the faint of heart especially shiver.

In our opinion, given the particular economic situation, where strong inflation is not compatible with sustainable economic growth, the space in which it can move Powell It is not completely widespread. Therefore, there will be an increase in prices until after 2% – Or at least that’s what the market expects – spread over several months.

Intervention may be easier than bringing back inflation 2%. But for now, central banks, like children, seem to be waiting for the time to fix things without anyone having the guts to act like an adult. The good news for Bitcoin And for crypto enthusiasts, with such strong assets in our portfolio, we can better exit those who still have significant exposure to traditional finance.

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