Jerome Powell

Global bank leaders say a recession is unlikely, but persistent inflation may lead to rate hikes

Bitcoin soared to around $31,230 Friday afternoon in New York for the first time since April

The central bank head appeared before lawmakers Wednesday to defend his monetary policy

Crypto moved further in the green while stocks went red — analysts say institutional interest and increased risk appetite are to blame

eToro’s Callie Cox noted that bitcoin has led the stock market “in seven of the last 10 Fed days”

Interest rates could end up “higher than anticipated,” the central bank chief said on Capitol Hill, Tuesday

The Nasdaq Composite and S&P 500 indexes rose as much as 1.4% and 1.1%, respectively, during Powell’s interview

The central bank raised interest rates by 25 basis points — that’s not surprising — but all eyes are on the subtext

If Powell and the committee signal a forthcoming pause in interest rate hikes, markets will react favorably, but a hawkish stance will likely send shares plummeting again

The hike marks the Fed’s seventh consecutive rate increase, a strategy it hopes will curb the highest inflation the country has seen in more than four decades

The S&P 500 and Nasdaq Composite indexes both gained about 1% and 1.5% in the moments following Powell’s speech

The Fed’s forward guidance statement did not provide clarity about what December might bring

Investors seem confident that the central bank will continue its rate hikes this week with a 75 basis point increase announced Wednesday, followed by 50 basis points in December

The regulator is particularly concerned about stablecoins, volatility and crypto token classification

Powell was guarded when asked about what might come in November — markets are still betting on a 75 bps increase at the next FOMC meeting

The S&P 500 and Nasdaq were trading 2.3% and 2.8% lower, respectively, at time of publication, while bitcoin and ether similarly lost 4% and 7%, respectively

Following Powell’s speech, markets predict chance of a 75 basis point September rate hike is slightly lower compared to earlier in the week

Both crypto and equities markets have taken a breather as investors wait cautiously for central bankers to gather at Jackson Hole.

Futures markets are now pricing in a 53% chance of a 50 basis point hike and a 48% chance of a 75 basis point hike in September

The Fed has kept an eye on labor statistics in recent months with the hopes of gauging the odds of a recession

Overall economic activity appears to have slowed a bit, Fed officials wrote in their statement released Wednesday, but employment remains high

The economy added 372,000 jobs in June, but the unemployment rate was 3.6% — unchanged from May

Central bankers lowered their growth forecasts for the second half of 2022 and 2023, despite a rebound in GDP during the second quarter of 2022

Central bankers predict elevated unemployment rates, prolonged higher prices and a slowdown in economic activity going forward