Marcus Sotiriou, Analyst at the UK based digital asset broker GlobalBlock
Bitcoin (CRYPTO: BTC) dropped yesterday, after Federal Reserve chairman Jerome Powell spoke about soaring inflation, before then rallying 6% overnight. Powell said that “inflation is much too high” and that the U.S. central bank is willing to raise rates more aggressively. In addition, Powell said that the federal funds rate could be raised higher than the traditional 25 basis points (bps) raise. The market reacted negatively to this, as we have been anticipating 25 basis point rate hikes this year so that we are not forced into a recession. A more aggressive increase in rates raises the chance of a recession, as it will slow growth more. In my opinion, they will not raise rates by more than 25 bps until September at the earliest, as the Federal Reserve will try their best to avoid a recession.
