Crypto Market Cap Jumps $40 Billion as Fed Chairman Powell Hints at ‘Disinflation’
The total crypto market capitalization jumped nearly 4% following a speech by US Federal Reserve Chairman Jerome Powell in which he suggested the process of disinflation in the economy had begun.
“We can now say, I think for the first time, that the disinflationary process has begun […] we really see it in the prices of goods,” Powell said at a Feb. 1 Federal Open Market Committee press briefing shortly after announcing a 0.25% federal interest rate hike.
Rising interest rates and remarks appeared to have come down well in crypto markets, which had been side trade in perspective at the speech, but saw its market capitalization increase by more than $40 billion within hours of the announcement.
The global crypto market cap is now $1.09 trillion, up 3.88% from the last day, according to to the latest figures from Coinmarketcap.
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That being said, Powell said he still expects inflation to continue to rise in the services sector for some time and is bracing for “continued rate hikes.”
“We see ourselves as having more persistent inflation in this [services] sector, which will take longer to collapse, and we have to finish the job. That’s what we’re here for. »
Powell noted that “continued rate hikes” would still be appropriate for the economy as the Federal Reserve attempts to bring inflation back to its target level of 2%.
The Fed reserve increases by 0.25%. His 8th hike. The Fed did not indicate the end of the hike cycle. But, the Fed Chairman said in his speech that he sees inflation coming down soon. 50% of inflation is in the “disinflationary” phase. The markets are reacting positively. #FOMC #Feed #asx $spx $ndq $xjo pic.twitter.com/1misOrnD2b
— Jessica Amir (@JessicaDAmir) February 1, 2023
It should be noted that disinflation refers to a slowdown in the rate of increase in the general price level, as opposed to deflation, where the general price level of goods and services decreases.
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