The Fed's latest statement at the Jackson Hole conference put the encryption market under pressure. President Kevin Walsh stressed that inflation in the United States remained significantly above the 2 per cent target and that the current financial environment was not sufficiently tight. After the speech, market risk retreated, and bitcoin, Ethera and XRP went down simultaneously.
Bitcoin has returned to the vicinity of $778 million.
In the last 24 hours, bitcoin fell by about 3.2 per cent, from around $80,000 to $77,812. During the same period, the market value of the entire encrypted currency fell by about 2.7 per cent, while the value of XRP fell by about 4.9 per cent.
Declining markets were accompanied by an expansion of liquidation. According to the data, the multi-liquidation of Bitcoin amounts to approximately $138 million, which represents the bulk of its total liquidation of $185 million. The bulk of the liquidation of the entire encryption market is about $351 million, with a total of about $468 million.
Walsh stressed that inflation was still not on target.
In his speech, Walsh stated that the United States economy remained resilient, with a robust job market, with an unemployment rate of about 4.1 per cent, close to years of low. At the same time, however, he pointed out that inflation was still far from the Federal Reserve ' s goal.
According to the figures quoted in the text, inflation in the United States PCE has been 3.7 per cent over the past year, with an annual rate of 4.1 per cent over the past six months, which is above the Federal Reserve target of 2 per cent. About 54 per cent of the sub-sections of the PCE basket have risen by more than 3 per cent over the past year, indicating that price pressures have not been fully abated.
Markets reduce reliance on forward guidance
Walsh also mentioned that the current indicators of credit terms, loan standards and credit spreads did not show that the financial environment was already sufficiently restrictive. This means that the Fed may still maintain a more cautious position on inflation.
In addition to inflationary statements, he diluted the market ' s reliance on the Federal Reserve ' s forward-looking direction, stating that the Federal Reserve ' s pronouncement as the sole forward-looking signal of the market had gone on too long. This statement is interpreted by the market as suggesting that future policy communication may reduce the hint of a clear path and that asset prices will be more driven by actual data.