Bitcoin's price surged back to $106,000 after dipping to $103,000 over the weekend. This rebound is linked to the Federal Reserve's comments about potential changes in monetary policy.
Jerome Powell's Comments on Monetary Policy
During a speech at the Fed's International Finance Division event, Jerome Powell noted that the current economic situation and global data are important. He did not directly mention interest rates; however, his remarks were interpreted as a signal that the Fed is considering altering its tight monetary policy.
Positive Outlook for Bitcoin
Experts argue that the prospect of policy changes is likely to benefit Bitcoin and other high-risk assets. Powell pointed to decelerating inflation and stable employment as positive factors for decision-making. Currently, inflation stands at 2.3%, close to the Fed's target of 2%, with the unemployment rate at 4.2%, indicating a stable economic situation.
Fed's Cautious Approach and Trader Expectations
Despite the positive commentary, the Fed maintains a cautious stance. Traders expect rates to remain unchanged at the upcoming June meeting. The CME FedWatch Tool indicates a 95.3% chance no changes in rates will occur. This cautious yet open position supports traders' hopes for future increases in Bitcoin and other cryptocurrencies.
Currently, Bitcoin is trading around $105,253, reflecting a slight drop in the past 24 hours. Nevertheless, the comments from Fed leadership raise hopes for potential further strengthening of cryptocurrency positions.
