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📰 The Update: In a major policy signal, Federal Reserve Chair Jerome Powell confirmed that a solid majority of the Federal Open Market Committee (FOMC) members now expect interest rate cuts later this year. During a recent statement, Powell noted: > “If the data continues to evolve as expected, the conditions for lowering rates will likely be met in the coming months.” This comes amid slowing inflation and weakening labor market data, putting pressure on the Fed to ease monetary policy after one of the most aggressive tightening cycles in decades.
💥 Why It Matters for Crypto:
Interest rate cuts often result in higher liquidity and risk-on sentiment across financial markets — which historically benefits crypto assets like Bitcoin (BTC) and Ethereum (ETH).
📊 Immediate Reactions:
BTC surged above $107,000, breaking major resistance. $BTC ETH climbed to $3,400, with altcoins showing strong follow-through. $ETH Crypto market cap reclaimed the $3.5T mark, led by institutional buying. $XRP
This aligns with historical trends where loose monetary policy boosts demand for decentralized, non-yielding assets.
🧠 Expert Insight: > “The Fed’s pivot could ignite the next leg of the bull run. We’ve seen similar patterns in previous cycles,” said a macro strategist at CryptoPulseDaily.
🔍 Sources:
CNBC – Fed Signals Rate Cuts Coming Federal Reserve Official Statement TradingView Market Charts
📌 Summary:
Factor Market Impact
🏦 Fed Pivot Bullish for risk assets 💵 Liquidity Boost Positive for Bitcoin/ETH 📉 Rate Cuts Ahead Supports long-term rally
💬 Final Thought: Macro tailwinds are aligning for crypto. As interest rates begin to ease, markets may reprice in favor of digital assets. Now's the time to stay informed and positioned s martly.
Inflation Storm Brewing: Tariff Expiry and Middle East Tensions Could Push U.S. CPI to 4% by Summer
Analysts at Bloomberg Economics are raising alarms about a potential inflation surge this summer, driven by the convergence of two escalating risks:
1. Tariff Trouble Ahead
Key Trump-era tariff suspensions are set to expire soon.
This could trigger a return of tariffs on over $300 billion worth of goods.
The reintroduction of these levies risks disrupting global supply chains and reigniting trade tensions—particularly with China.
2. Middle East Oil Shock
Rising geopolitical tensions in the Middle East could send oil prices soaring past $130 per barrel (currently around $85).
Every $10 jump in oil prices is estimated to add 0.4 percentage points to U.S. CPI.
The timing is especially problematic, as the summer driving season is likely to magnify fuel price pressures.
🔍 Inflation Outlook
CPI could hit 4% by August, up from the current 3.3%.
Fed rate cuts may be postponed until late 2024 or even into 2025.
Consumers could face a double hit from higher fuel costs and rising prices on imported goods.
📊 Market Reactions
Energy stocks are gaining in anticipation of higher oil prices.
Treasury yields are gradually rising as inflation expectations build.
Fed futures now reflect expectations of only 1.25 rate cuts in 2024, down from earlier projections.
🎯 Policy Crossroads
Policymakers now face a difficult balancing act:
Taming inflation
Avoiding a recession
Navigating politically sensitive decisions in an election year
With Trump pushing for new tariffs and Biden facing limited options to curb oil prices (given depleted strategic reserves), volatility in both markets and policy is expected to rise heading into the fall.