Key Points
- Jerome Powell, Federal Reserve Chair, is set to address the NABE annual meeting amidst market volatility.
- His speech could impact both traditional and crypto markets, depending on signals about US interest rates.
Jerome Powell, the Chair of the Federal Reserve, is scheduled to give a highly anticipated speech at the NABE annual meeting today. His speech comes at a time of significant market instability, with investors keen to understand the future direction of US interest rates.
Currently, futures markets are predicting a 97% likelihood of a 25 basis point rate cut in October and an 89% chance of another in December. These predictions indicate widespread expectations for monetary easing in response to signs of an economic slowdown.
Implications of Powell’s Speech
If Powell suggests that interest rates may stay higher for an extended period, analysts warn of potential renewed sell-offs in both traditional and crypto markets. This would be a result of investors adjusting their expectations and strategies.
Powell’s speech is taking place amidst ongoing geopolitical and economic uncertainty. Recently, President Donald Trump announced 100% tariffs on Chinese imports, which led to a sharp decline across risk assets.
The U.S. government shutdown has also delayed the release of key economic data, such as consumer inflation and wholesale cost reports. As a result, investors and policymakers have limited visibility, increasing the importance of Powell’s remarks.
Impact on Crypto Markets
The crypto market is currently down by 4%, with Bitcoin (BTC) falling to $111,000 at the time of writing. Analysts have identified the $108,000-$110,000 range for Bitcoin as a crucial support zone. A drop below these levels could trigger a new wave of cascade liquidations in leveraged positions.
Some high-level traders may be positioning for Powell to cancel or delay rate cuts. Despite the short-term volatility, analysts anticipate a market surge in the next couple of months, with many traders searching for the next low-cost crypto to skyrocket.
