Why bitcoin and crypto are gaining ground thanks to Powell’s conciliatory remarks on Jackson Hole

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Bitcoin prices and the broader complex of virtual currencies were on the rise, and the US dollar was down on Friday, after a speech by Federal Reserve Chairman Jerome Powell was interpreted as accommodating, or less inclined to promote aggressive tightening of financial conditions.

Bitcoin prices at last check were changing hands at $ 48,224, up 2.7%, while Ether on the Ethereum blockchain traded more than 4% at $ 3,239 on Friday afternoon.

The moves for bitcoin come after Fed Chairman Jerome Powell said he was advocating to start cutting back on central bank bond purchases implemented during the worst financial market disruptions of 2020, but has said he does not expect the central bank to raise benchmark interest rates, which currently stand in a range between 0% and 0.25%, anytime soon.

Powells’ comments may also give the central bank some leeway to see at least one more report on the non-farm payroll before committing to unwinding the easy money policies as the delta variant of the coronavirus spreads.

Find out: Need to know: Here’s what the Fed will do if it follows what Powell said to Jackson Hole last year

I was of the opinion, like most of the participants, that if the economy was going broadly as expected, it might be appropriate to start slowing the pace, Powell said.

Equity markets rebounded, with the S&P 500 SPX Index, + 0.88% and the Nasdaq Composite Index COMP, + 1.25% reaching new highs and the Dow Jones Industrial Average DJIA, + 0.66% not far from its own records.

Meanwhile, comments from Fed chairmen have also fueled the buying of government debt, with the 10-year Treasury benchmark TMUBMUSD10Y 1.312% yielding 1.32%, up from 1.34% ago. one day.

Investors still believe historically low borrowing costs will support risk taking on Wall Street. This dynamic may be true for stocks and digital assets such as bitcoin, ether, and even meme assets such as DOGEUSD dogecoin, + 5.52%.

The overall crypto market is 3.0% higher in the previous 24 hours as the market appears to respond positively to accommodating comments from Fed Chairman Jerome Powell this morning, crypto researchers at Fundstrat Global wrote. Advisors, in a daily update.

The total value of the crypto market is around $ 2.1 trillion, maintaining its highest level since around May, according to data compiled by CoinMarketCap.com.

Bitcoin, however, is still struggling after starting the week around $ 50,000, its highest level since mid-May, a level that is starting to form resistance for the crypto.

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