$BTC 19.03 ON WEDNESDAY an important day for all markets: the decision on rates in Japan and the USA. If Japan raises rates again, markets will fall, as they did in early August '24 and late January '25. The Japanese promise not to touch them this time. The USA is likely to leave things as they are. In the case of such a calm, markets will be determined by the rhetoric of the head of the Fed. He has already warned that the decision will be based on the consequences of Trump's tariffs, as they can both drive inflation and slow it down:
1. Tariffs increase inflation if rising prices do not reduce purchasing activity. Prices for goods rise, people buy, and production is still at old prices, company profits increase, stocks rise, and crypto too.
2. Tariffs decrease inflation if rising prices deter customers, as people have no savings, credit lines are exhausted, they choose cheaper goods, postpone purchases, sellers lower prices for competitiveness, cutting costs, laying off people, unemployment rises, unemployed spend less, sell assets, company stocks fall, bankruptcies occur.
The consequences can only be assessed in April, and they depend on what stage this economic cycle is in.