Key Takeaways From Jerome Powell’s Speech Today; What Next For Crypto?

Jerome Powell speech: US Fed Chairman Jerome Powell on Tuesday spoke in an interview with Carlyle Group co-founder David Rubenstein at the Economic Club of Washington DC. Powell’s comments came just a week after he delivered the post FOMC press conference. After the Fed delivered a 25 bps rate hike last week, the US Bureau of Labor Statistics reported huge job additions to the economy, bringing the unemployment in the country to the lowest in five decades.

The crypto market, which reacted smoothly to Powell’s comments, could eventually find more macro led support as inflation reduces as expected later in 2023. The Fed Chair opted to give out a neutral statement when asked about the robust jobs report, as against a dovish comment as was feared in the markets. However, it remains to be seen how crypto prices factor in the Fed Chair’s comments in the hours to come. In the last one hour, BTC price rose by around 0.50%.

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Here are the key takeaways from his Powell speech today:

• The Fed Chair said the target of bringing down inflation to 2% will remain, when asked if a 3% target was ideal. This means the policy tightening could continue until the 2% target is met.
• Powell said the year 2023 could see significant reduction in inflation, in an encouraging sign for the crypto market.
• However, the disinflationary process is likely to take longer than expected. Powell said the Fed would certainly raise rates more if data continues to come in stronger than expected.
• Inflation in the goods sector is coming down but it is still not seen in the housing sector, which puts the question of disinflation hopes in question.
• When asked if he thinks whether the economy is in control with inflation and the geopolitical scenario with the Ukraine war, he said the Fed predominantly takes into consideration the supply and demand chain with the United States.
• About the concerns of economy facing the danger of debt default, Powell said it is the Congress that decides on
  how much the debt ceiling should be marked at.
• Interestingly, Powell revealed he draws a salary of $190,000 in his capacity of the Chair of the Board of Governors of the Federal Reserve System.
• Powell rides a bike, plays guitar and read fiction to relieve stress !

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