Thursday, May 23, 2024

Bitcoin Soars While Stocks Slide After Hawkish Fed Comments.

For cryptocurrency bulls, it was a day of positive divergence as stocks fell late in the U.S. trading session and bitcoin {{BTC}} erased the majority of the week’s losses.

The S&P 500 and Nasdaq saw a nearly 1% decline in late afternoon trading; this was a 2% reversal from previous session highs, not a significant loss. Neel Kashkari, President of the Minneapolis Fed, made aggressive remarks that contributed to the declines.

During a virtual engagement on LinkedIn, Kashkari stated, “I would question whether we [need] to do those rate cuts at all if we continue to see inflation moving sideways.” Although Kashkari has been one of the more hawkish Fed members this cycle, his comments shouldn’t have come as a huge surprise because stocks immediately responded negatively. Additionally, his remarks contradicted those made by Fed Chairman Jerome Powell yesterday, when he told a Stanford audience that he still expects rate reductions this year. However, Friday’s release of the government’s March employment data may shed further light on the rate outlook.

Those who were hoping that the Fed would switch to a rate-cutting cycle sooner due to deteriorating job data have not been satisfied thus far, as employment growth has remained strong during 2023 and the first part of 2024. According to economist estimates, there was a notable increase in employment in March, with 200,000 new positions added, compared to 275,000 in February. It is anticipated that the unemployment rate will remain at 3.9%. After falling as low as $65,000 over night, bitcoin rose throughout most of the American day, reaching a high of $69,000 at one time. The cryptocurrency was up 4.5% over the previous day at $68,750 as of the time of publication. Over the same period, the larger CoinDesk 20 Index was up 3.25%, while {{ETH}} was a noticeable laggard, gaining just 1.75%.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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