After United States Federal Reserve Chair Jerome Powell suggested that inflation had started to slow down in the largest economy in the world, the price of Bitcoin surpassed the $24,000 barrier, and the total market capitalization of cryptocurrencies increased by almost 4%.
After announcing a 0.25% increase in the federal interest rate on February 1, Powell stated, the disinflationary process has started and the prices are encouraging.
The crypto markets, which had been trading sideways before Powell’s speech but saw market cap rise by more than $40 billion in the hours following the announcement, looked to have received the rate hike and Powell’s remarks favorably.
Following a speech by United States Federal Reserve Chair Jerome Powell in which he said the economy’s disinflationary process has started, the overall market capitalization of cryptocurrencies increased by almost 4%.
According to the most recent data, the total value of all crypto assets is now $1.09 trillion, an increase of 3.88% over the previous day. Meanwhile, BTC surpassed $24,000 for the first time in 2023, reaching $24,161.27.
Nevertheless, Powell stated that they should be ready for “ongoing rate rises” and that they continue to expect inflation to rise in the services sector for some time.
Powell stated that even as the Federal Reserve works to get inflation down to its goal level of 2%, “ongoing rate rises” will still be appropriate for the economy.
It should be emphasized that disinflation is different from deflation. In deflation, the overall price level of products and services drops. Disinflation refers to a reduction in the rate of increase in price levels.
