US Federal Reserve (FED) Chairman Jerome Powell addressed the Senate Banking Committee today. His cautious stance on interest rate cuts was highlighted. Powell stated that more positive data is required for rate cuts. This statement followed the first-quarter data, which did not support greater confidence in the path of inflation.
Powell emphasised that the Fed would not cut rates until more confidence is gained. He stressed the importance of seeing inflation move sustainably toward 2%. High inflation is not the only risk faced. Positive data will strengthen the confidence in inflation’s decline. Restrictive policy helps reduce downward pressure on inflation. Recent data show progress toward the 2% inflation target.
Bitcoin (BTC) reacted to Powell’s speech. Before the speech, Bitcoin traded at $57,200. Following the speech, Bitcoin rose above $58,000. This rise indicates market optimism. Powell’s statements have an immediate impact on the market.
The FED President will speak to the US House of Representatives Finance Committee tomorrow. Further insights may influence the market. Powell’s cautious approach continues to be a focal point. The emphasis on data-driven decisions resonates with investors.
This development underscores the intricate relationship between policy statements and market reactions. Investors closely watch such statements for cues. Powell’s speech highlights the importance of data in shaping monetary policy. The market’s response reflects the sensitivity to such high-level statements.
