As a seasoned researcher with extensive experience in financial markets and cryptocurrencies, I have closely monitored the recent trend of increased optimism among investors regarding central bank decisions and their potential impact on both traditional equities and cryptocurrencies. With key economic data releases and the Federal Reserve’s (Fed) meeting scheduled for this week, there is a heightened sense of anticipation in the market.
At the beginning of Monday, cryptocurrencies gained ground due to rising equity markets. This improvement suggests growing confidence among investors in anticipation of significant central bank announcements.
As a seasoned financial analyst with over two decades of experience under my belt, I can tell you that this week is shaping up to be an exciting one for investors. We’re all on the edge of our seats, waiting with bated breath for the release of crucial economic data and the highly anticipated Federal Reserve meeting scheduled for the week.
Anticipation is high among investors that interest rates will hold firm in the near term. However, they are eagerly waiting for indications regarding potential rate reductions and their timing in 2023. Consequently, they will closely monitor any policy statements from the central bank and pay particular attention to the post-meeting address by Federal Reserve Chairman Jerome Powell.
On Friday, the personal consumption expenditures (PCE) price index, which is the preferred inflation metric for the Federal Reserve, remained in line with expectations. Specifically, the PCE increased by 0.1% compared to May and rose by 2.5% on a year-over-year basis in June.
Recently, traders have been anticipating a high likelihood that the Federal Reserve will lower interest rates for the first time this year by September.
Although Federal Reserve officials have consistently emphasized their need for further proof that inflation is approaching the 2% mark before considering a rate reduction, Fed Chairman Jerome Powell hinted earlier this month that the Fed might take action before reaching this threshold.
Crypto market reacts
As a financial analyst, I’ve observed that Bitcoin surpassed its previous peak from mid-June today, recording a new high of $69,868 during the early trading hours. This upward trend can be attributed to the growing optimism amongst investors regarding potential U.S. Federal Reserve interest rate reductions.
Currently, Bitcoin is experiencing a 2.65% increase over the past 24 hours, reaching a price of $69,520. A number of cryptocurrencies are also trending positively, with Ethereum, Solana, and Dogecoin reporting gains between 2% and 4%. Bitcoin Cash is seeing particularly significant growth, with an increase of up to 15%.
Later this week, the Federal Reserve meeting could pave the way for a series of interest rate reductions, which is generally seen as beneficial for cryptocurrencies. This optimistic outlook has positively influenced market mood.
Bitcoin currently sits approximately $4,400 below its record high of around $74,000, which it reached in March. However, investments into certain US Bitcoin exchange-traded funds (ETFs) have contributed to a rise in the cryptocurrency’s value during 2021.
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2024-07-29 17:34