Bitcoin smashed through the $24,000 barrier, and the global crypto market value increased by roughly 4% after United States Federal Reserve Chair Jerome Powell signaled that inflation in the world’s largest economy has begun to decline.
“We can now declare, I believe for the first time, that the disinflationary process has begun […] we see it truly in goods prices,” Powell said during a news conference on February 1 after announcing a 25-basis-point interest rate rise.
The rate hike and Powell’s statements looked favorably received in the crypto markets. They traded sideways before the speech but saw their market valuation climb by more than $40 billion in the hours after the announcement.
According to Coinmarketcap, the worldwide crypto market cap is now at $1.09 trillion, up 3.88% in the past day.
Meanwhile, according to Coinmarketcap, BTC surpassed $24,000 for the first time in 2023, hitting $24,161.27.
Powell stated that they expect inflation in the services sector to grow for some time and are prepared for “ongoing rate hikes.”
“We see ourselves as having more persistent inflation in that [services] sector, which will take longer to get down, and we have to complete the job. That’s what we’re here for.”
Powell stated that “ongoing rate hikes” would be acceptable as the Fed strives to restore inflation to its 2% target level.
It should be mentioned that disinflation refers to a slowing of the pace of growth in general price levels, as opposed to deflation, which refers to a fall in the general price level of products and services.
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