US Central Bank Expected to Raise Lending Rate by 25bps: Experts Predict Final Hike of 2023

After the most recent increase in the federal funds rate, the U.S. Federal Reserve is set to raise the lending rate by 25 basis points (bps) to 5.25% in three days, according to expectations. A recent poll of 105 economists revealed that 94 of them predict a 25bps rate hike will occur during the May [...]

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World’s Largest Asset Manager Blackrock Predicts No Fed Rate Cuts This Year

The world’s largest asset manager, Blackrock, does not see the Federal Reserve cutting interest rates this year. “That’s the old playbook when central banks would rush to rescue the economy as recession hit. Now they’re causing the recession to fight sticky inflation – and that makes rate cuts unlikely, in our view,” said the firm’s [...]

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Bitcoin options: How will tomorrow's $4.7B expiry impact BTC price?

Bitcoin ETF requests, miners' sell pressure, and regulatory hurdles create uncertainty for the $31,000 BTC price resistance.

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South African Rand Plunges to New Low After Benchmark Interest Rate Is Raised to 14-Year High

The South African fiat currency’s exchange rate versus the U.S. dollar plunged to a new all-time low of 19.7640 per dollar on May 25 just moments after the South African Reserve Bank raised the benchmark interest rate to its highest since 2009. Although the currency has since made some recovery, prediction models show that the

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Market Strategist Discusses ‘Super Bubbles’ Bursting — Warns of ‘Outrageously Consequential, Painful Effects’

Market strategist Jeremy Grantham, co-founder of asset management firm GMO, has warned of “super bubbles” bursting. He explained that the Federal Reserve has “created an environment conducive to a chain-linked series of super bubbles that break with outrageously consequential, painful effects.” Jeremy Grantham’s Warnings Investment strategist Jeremy Grantham shared his U.S. economic outlook with economist [...]

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European Central Bank Follows US Fed’s Footsteps With 25 BPS Hike

On Thursday, the Governing Council of the European Central Bank (ECB) announced that it was raising “three key ECB interest rates” by 25 basis points (BPS) in a move similar to the one taken by the United States Federal Reserve.  The US Federal Reserve, on Wednesday, increased its fund rates by an additional 25 BPS, its highest interest rate in 22 years. European Central Bank In The Fight Against Inflation The European Central Bank, in its statement, admitted that although inflation continues to decline, it is “still expected to remain too high for too long.” In a bid to fight inflation and return it to its 2% medium-term target in a timely manner, the governing council has continued to hike the interest rates for some time now, and this has further raised concerns for investors in the financial market as to whether or not there will be hikes before year ends.  Related Reading: Lacoste Unveils Exclusive Ethereum-Based Virtual Store For NFT Holders For context, the ECB has raised rates by 4.00% since last year July, accounting for the fastest-tightening cycle in its history. It is projected that this rapid increase in rates could negatively affect the expansion of loans in the European region and economic activity also.  A quarterly poll released by the ECB on July 25 revealed that the companies’ demand for loans plunged to its lowest in the second quarter of this year. The eurozone has less developed and liquid capital markets than the United States, so there is an overreliance on banks in financing the economy.  And now, according to ECB Chief Economist Philip Lane, the tighter monetary policy is massively impacting bank loans. So such policies will undoubtedly cause a liquidity squeeze.  Bitcoin’s Role Although inflation continues to decline, it is evident that the ECB and US Federal Reserve aren’t getting the desired results as to the target to which they want to bring inflation down to. As such, these financial bodies may continue increasing the rates to as high as possible despite the dramatic economic slowdown.  Investors are aware of this position and are looking toward Bitcoin and other cryptocurrencies for succor. For a long time now, Bitcoin has been tagged as a ‘hedge against inflation,’ and it seems that many are realizing that this is more than a tag as Bitcoin has remained stable despite the growing rates, which many would have expected would send Bitcoin and the crypto market spiraling down.  Related Reading: Short-Lived Hype: Worldcoin (WLD) Signups Dwindle Less Than A Week After Launch Unlike the United States, European investors are lucky to have more regulatory certainty in the region. The Markets in Crypto Assets (MiCA) regulation offers a sense of direction to stakeholders in the European crypto industry. This will help businesses and investors navigate their way when operating and dealing with crypto assets.  BTC price sitting at $29,300 | Source: BTCUSD on Tradingview.com Featured image from PYMNTS, chart from Tradingview.com

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Will BTC ditch the bear market? 5 things to know in Bitcoin this week

Bitcoin (BTC) enters the last week of March in uncertain territory as a strong weekly close still keeps $30,000 out of reach. The largest cryptocurrency has sealed seven days of practically flat performance despite some volatility in between as the market seeks fresh direction. Where could it go next? In what was a week of [...]

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Compound (COMP) Bulls Strengthen Market Control With 13% Rally

COMP, THE native token of Compound Finance, has seen its market price rise significantly on Wednesday, emerging as the top gainer of the day. According to data from CoinMarketCap, COMP is up by 13.24% in the last 24 hours as the bulls increase their control of the market. Initially, COMP began the week with a [...]

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Will This Political Deal In The US Save Bitcoin and Crypto?

Politicians in the United States will likely strike a deal and raise the government’s $31.4 trillion debt ceiling for two more years. Amid this debate, the price of Bitcoin is firm but lower, tracking below the psychological $30,000 level as bulls recover after posting sharp losses mid-this week. The Debt Ceiling Debate There are reports that there will be more discretionary spending on the military and veterans with the reduction of other sectors. Moreover, there are unconfirmed reports that the Biden administration will likely not fund the Internal Revenue Service (IRS) to boost collection, as laid out earlier. Instead, the immediate focus will be to hire more auditors and target wealthy citizens. Related Reading: Bitcoin Up After Fed Rate Reveal, Correlation With Stocks Over? There are concerns that the Treasury Department and the United States government will default on their obligation as soon as the first half of June 2023. Even though highly unlikely, as the Treasury Department has said it will liquidate $119 billion of debt on that day, the market is watching how discussions pan out. Bitcoin is firming up after losses on May 24. As a deal is reportedly struck and consensus reached, politicians would once again lift the debt ceiling, sending mixed signals to the economy. Unlike in previous years when top cryptocurrencies were decoupled from the mainstream economy, things have changed as Bitcoin’s prominence rises. Will Bitcoin Benefit? BTC prices will likely rally if there is an instance of default brought about by politicians disagreeing on the way forward. On the reverse side, a deal that addresses concerns brought by the negotiating parties could signal confidence in the economy despite more debt on the table. This averts a crisis and keeps operations running, removing uncertainty and stabilizing the economy. In that case, the USD could strengthen, possibly reversing gains by Bitcoin bulls in the last two trading days. Still, the crypto community remains bullish on Bitcoin considering macroeconomic events and next year’s halving. After months of steady interest rate hikes, the United States Federal Reserve could slow down rate increments in the next meeting in mid-June. Their action could support the commodities and securities markets. Related Reading: Nigeria’s Federal Executive Council Approves Blockchain Policy At the same time, the expected supply shock following the halving of Bitcoin miner rewards could make BTC scarcer, driving prices even higher. Miners are special nodes tasked with confirming transactions and decentralizing the network. If past price action can be used to predict future formations, BTC’s prospects look positive. Before the rally of 2020 to 2021, BTC prices bottomed up in 2018 and rose in 2019 before the halving event 2020. The same pattern may be repeated through to 2024 when Bitcoin halving occurs. Feature Image From Canva, Chart From TradingView

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Market Outlook: CME Fedwatch Tool Points to Increased Chance of June Rate Hike

According to the CME Group Fedwatch tool on Thursday, there was a 51% probability of a quarter-point rate increase during the upcoming Federal Open Market Committee (FOMC) meeting on June 14. Just a fortnight ago, the Fedwatch tool indicated a slim possibility of the federal funds rate reaching 5.50% next month. The following day on [...]

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Billionaire Barry Sternlicht Warns of Hard Landing — Says ‘Economy Is Going to Implode’

Billionaire Barry Sternlicht, chairman and CEO of Starwood Capital Group, has warned that the U.S. economy is going to implode, emphasizing that interest rates have to fall. He further stressed that the economy “will have a hard landing.” Barry Sternlicht on Hard Landing, Economic Implosion The chairman and CEO of Starwood Capital Group, billionaire Barry [...]

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Billionaire Bill Ackman on US Banking Crisis: ‘I Fear We Are Heading for a Train Wreck’

Billionaire Bill Ackman has warned that the U.S. economy is “heading for a train wreck” if the government allows the current banking crisis to continue. “Trust and confidence are earned over many years, but can be wiped out in a few days,” he said. “Hopefully, our regulators will get this right.” Bill Ackman’s Warning Billionaire [...]

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Countdown To FOMC: What Bitcoin And Crypto Traders Must Brace For

As the eagerly anticipated Federal Open Market Committee (FOMC) meeting approaches, the financial world is abuzz with speculation about the potential implications for Bitcoin and crypto. Tomorrow, on Wednesday, July 26th, at 2 pm EST, the FOMC will announce its interest rate decision. As usual, Federal Reserve (Fed) chair Jerome Powell will face the media at 2:30 pm EST. According to the CME FedWatch tool, the majority of the market is expecting a 25 basis point increase (99.8%). However, the real intrigue lies in what comes after this move and whether it marks the end of the rate hike cycle. After tomorrow’s decision, the market expects the Fed to keep the key interest rate high for a longer period of time. A first rate cut could come in March 2024 at the earliest, if not in May. Tomorrow is #FOMC day, expect volatility. #Bitcoin #Crypto 98.9% probability of a 25 bps hike by the Fed. Market expects the Fed to keep the key interest rate high for a longer period of time. A first rate cut could come in March ’24 at the earliest, if not in May. pic.twitter.com/C8wscv6BMd — Jake Simmons (@realJakeSimmons) July 25, 2023 Implications For Bitcoin And Crypto For the past 16 months, the U.S. Federal Reserve has been grappling with inflation while hiking interest rates to levels not seen in 20 years. But all signs point to a possible end of the tightening cycle. The market is firmly expecting the 0.25 bps hike to a range of 5.25 to 5.5% will be the last. Meanwhile, Bitcoin and crypto have experienced a period of relative immunity to macroeconomic events and rate hike speculations in the first seven months of the year. However, investors must be aware that such conditions might not last indefinitely. Related Reading: Bitcoin Witnesses Historic Whale Exodus: What You Need To Know On Monday, the Bitcoin price retraced to $29,000 support level. Seemingly, market participants have been cautious in the lead-up to the FOMC’s July meeting, aware that the FOMC meeting can have a profound impact. In June, Fed Chairman Jerome Powell hinted at the possibility of further rate hikes this year, with some committee members advocating for two more increases. The market now anxiously awaits the outcome of this meeting to ascertain the central bank’s future policy stance. However, factors such as declining inflation in the United States and a weaker labor market strengthen the market expectations. The previously skyrocketing inflation, which led to the tightening cycle, has shown signs of abating. June’s Consumer Price Index (YoY) data revealed a decline in inflation to 3.0% from 4.0%. The core rate fell from 5.3% in May to 4.8% in June. Both declines were stronger than previously anticipated. Remarkably, the core rate is now trading below the level of the US federal funds rate, which was pretty rare in the last 20 years. Related Reading: Over $41 Million in Bitcoin Long Positions Liquidated as BTC Crashes Toward $29K The prolonged strength of the US labour market has long been the biggest headache for the Federal Reserve because of the imbalance between supply and demand. At the peak of this imbalance, there were two job openings for every available worker, which drove up wages accordingly. As demand and supply approach equilibrium, job creation numbers have declined. Also, there are even early indications of declining consumer spending. So, what does all of this mean for Bitcoin and crypto investors? As always, it’s essential to approach the market with a balanced perspective. While BTC and cryptocurrencies have shown resilience in the face of traditional economic events, they are not entirely insulated from larger macroeconomic trends. Investors should closely monitor the FOMC’s interest rate decision and Jerome Powell’s subsequent statements. Any signals about the future rate hike cycle could have repercussions for both the traditional as well as Bitcoin and crypto markets, triggering a further sell-off. At press time, the market continued to show indecision. BTC was trading at $29,200. Featured image from iStock, chart from TradingView.com

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U.S. Treasury yields soar and Bitcoin stumbles amid debt ceiling, rate hike concerns

U.S. Treasury yields experienced a notable rise this week, causing increased apprehension in the market. Notable upswings occurred on Wednesday and Thursday when concerns over the debt ceiling and speculation over interest rate hikes pushed yields to record highs. In the early hours of Thursday, May 25, the yield on the 12-month Treasury bill reached […]

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Billionaire ‘Bond King’ Jeffrey Gundlach Predicts the Fed Will Cut Rates Substantially Soon

Billionaire Jeffrey Gundlach, aka the “Bond King,” has predicted that the Federal Reserve will be cutting interest rates substantially soon. “Red alert recession signals,” he added, noting that all U.S. Treasury yields two years and out are “well below the fed funds rate.” Doubleline CEO on Fed Rate Cuts and Recession Jeffrey Gundlach, chief executive [...]

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Federal Reserve Admits Blindsided Oversight of SVB Collapse

The Federal Reserve Chairman has admitted to being blindsided by the sudden collapse of Silicon Valley Bank (SVB) despite being under their supervision. The collapse of SVB has prompted an internal investigation led by the Vice Chairman to look into the failure of the bank and the Fed’s regulation of it. The bank’s collapse has been linked to the Federal Reserve’s successive interest rate hikes and erosion of its long-term bonds. This has led to depositors requesting withdrawals en masse, causing a bank run, and the Federal Deposit Insurance Commission taking possession of SVB. (Read More)

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Dogecoin (DOGE) Makes Slight 6% Climb This Week – Here’s Why

Dogecoin (DOGE) price has experienced a slight upward movement, bringing hope to its supporters amidst a tumultuous period for the cryptocurrency market. Earlier today, the meme-inspired digital currency has risen by 6%. This latest surge in Dogecoin price albeit small may be partially attributed to the continued support of billionaire tech entrepreneur Elon Musk, who [...]

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Moody’s Warns of Potential Financial Disruption Spillover Beyond US Banking Sector

Roughly ten days ago, the credit agency Moody’s Investors Service downgraded the U.S. banking sector from “stable” to “negative.” In a recent update on Thursday, the company stated that there is still a risk to the U.S. economy. The managing director of credit strategy at Moody’s explained that the country “will be unable to curtail [...]

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Federal Reserve Chair Powell Hints at Possible Pause in Interest Rate Hikes

Federal Reserve Chair Jerome Powell has hinted that the Fed may pause raising interest rates at the Federal Open Market Committee (FOMC) meeting next month. “Having come this far, we can afford to look at the data and the evolving outlook and make careful assessments,” Powell said. Fed Chair Jerome Powell on Rate Hikes Federal

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Federal Reserve Hikes Rate by 25bps to Keep Inflation at Bay, Aims for 2% Inflation Rate by 2025

Following the fallout over the past two weeks in the U.S. banking industry, the Federal Reserve raised the federal funds rate by 25 basis points (bps) on Wednesday, citing the need for the inflation rate to return to 2% over the long run. Fed Raises Rate Despite Calamity in the U.S. Banking Sector It’s been [...]

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