Here’s Why Crypto Prices Fell After The FED Chair’s Recent Comments!
Here is why crypto prices fell after The FED Chair’s recent comments! The last few days have been tough for the crypto industry mainly due to the recent comments made by The FED Chair.
The Fall of Crypto Prices
The community has been buzzing for the last few days because the crypto prices have been falling. Bitcoin (BTC) and Ethereum (ETH) have been showing a decline in their prices. At the time of writing, according to data from CoinMarketCap, the Bitcoin (BTC) price is $19,837. As for Ethereum (ETH), the price is $1,456.
Why Did They Fall?
Recently, crypto prices have been falling after The FED Chair made certain comments at the their annual economic conference in Jackson Hole. During the event, The Federal Reserve (FED) Chair, Jerome Powell said that the US central bank may continue to raise interest rates.
So far, the FED has been continuously increasing interest rates these past few months in order to tame inflation rates. However, many in the crypto community have been looking forward to the lowering of interest rates as the rise of inflation seems to have slowed down this past month.
Powell said, “While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses. These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.”
Speech by Chair Powell on the economic outlook: https://t.co/a7oRBw533P
Watch live: https://t.co/4AjHPi6hX8
— Federal Reserve (@federalreserve) August 26, 2022
How Will It Affect The Crypto Market?
After Powell’s statements on possibly raising interest rates, the crypto market has been showing the signs of continuously declining. Some in the community say that the crypto market may even end up becoming an even bigger bear market than it already was if interest rates continue to increase in the future.
This is due to the fact that the rise in interest rates lead to an even stronger dollar, which causes investors to move away and cash out in order to avoid risky assets.
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