The price of the leading cryptocurrency Bitcoin [BTC], fell by the foremost numbers within a week after Federal Reserve Chair Jerome Powell acknowledged he “would be concerned” by tightening financial conditions, as rising the United States govt-bond yields put upward pressure on purchasing costs.
The comments might signal more hesitation in offering fresh monetary stimulus. Bitcoin prices quadrupled earlier last year and have rallied 66% this year on speculation the crypto-asset could function as an inflation hedge in the face of trillions of dollars of cash printing by central banks around the world.
At the reporting time, Bitcoin [BTC], was changing hands around $48,336 USD, down about 4% on the day.
Powell added within a question-and-answer session with the Wall Street Journal he doesn’t expect higher inflation to persist and that the central bank still remains “a great distance from our goals” of an economic recovery & lower unemployment.
The yield on 10-year United States Treasury note climbed earlier on Thursday above 1.5%, as disappointment spread among some traders within the traditional markets who had bet the Fed might offer specifics on the way to tamp long-term interest rates, consistent with the Bloomberg News.
For bitcoin traders who are betting the crypto assets price might be a good hedge against potential currency debasement, Powell’s comments offered few signs the Fed plans new dovish actions. Such moves might embody expanding the United States central bank’s $120 Bln-a-month bond-purchasing program.
“Powell didn’t deliver,” the crypto asset trader Alex Kruger tweeted. “Basically repeated his usual dovish lines.”
Stocks were lower today on Thursday, also potentially reflecting dimmed expectations of more stimulus that may boost the equities market.