Fed is “steadfast” on raising interest rates, tightening monetary policy to tame inflation – Gold and stocks sink – Economy Bitcoin News

Several reports detail that US Federal Reserve officials are determined to tighten monetary policy and raise the federal funds rate until inflation in America is eased. Chicago Fed Chairman Charles Evans explained Tuesday that the central bank will likely keep pace with larger-than-usual rate hikes until inflation is healed.

The Fed “has done nothing” when it comes to more restrictive policies, the central bank has not seen an “inflation turnaround”

The Federal Reserve is in a tough spot as inflation in America is the highest since the 1980s. On Tuesday, a report citing three members of the US central bank indicates that Fed policymakers are still convinced that further rate hikes are needed to tame rising inflation in the country.

San Francisco Fed President Mary Daly explained in a Linkedin interview “we are still steadfast and completely united” in bringing down inflation. Daly stressed that the Fed “has done nothing in terms of implementing monetary policy measures and in terms of fighting inflation, he said the central bank still has” a long way to go “.

On Tuesday, President and CEO of the Federal Reserve Bank of San Francisco Mary Daly said, “People are still struggling with the higher prices they are paying and with rising prices. The number of people who can’t afford what they easily paid for six months ago this week just means our work is far from done. “

“My modal perspective, or the perspective that I think is more likely, is actually that we raise interest rates and then hold them there for a while at whatever level we see fit,” Daly noted. Cleveland Fed Chair Loretta Mester’s opinion was similar, as she told the Washington Post (WP): “We have more work to do because we haven’t seen that turn in inflation.”

Cleveland Federal Reserve Bank President and CEO Loretta Mester told WP: “I don’t think we’re in a recession. Of course, activity has slowed and you are right, the GDP report has shown negative growth for two consecutive quarters, but you actually have to look at the composition of that growth to discern which parts of the economy are slowing. “

Chicago Fed Chairman Charles Evans also shared his opinion on Tuesday. Evans told reporters that the Fed will likely continue to raise interest rates until inflation drops. While talking about larger-than-usual rate hikes in the 75 basis point range, Evans also made it clear that a 50 basis point rate hike could still occur.

Federal Reserve Bank of Chicago President and CEO Charles Evans said, “I am still confident we can make a 50 basis point hike in September and then continue with 25 basis point rate hikes through the start of the second quarter. of 2023. We must be aware that inflationary pressures could widen ”.

“If you really thought things weren’t getting better … 50 bps is a reasonable rating, but 75 bps might be fine too. I doubt more would be needed, “Evans said. Amid the aggressive statements by Fed members on Tuesday afternoon (EST), cryptocurrencies, stocks and gold markets have lost value. The US dollar, on the other hand, does. it strengthened against the Japanese yen and other major fiat currencies after a brief decline.

Volatility affects stocks, gold, cryptocurrencies

At the closing bell on Tuesday, all major equity indices were down, including the Dow Jones Industrial Average, the Nasdaq, the NYSE, and the S&P 500. The cryptocurrency markets also lost some gains and the market cap is hovering just above. $ 1.13 trillion. Bitcoin (BTC) slid below $ 23,000 per unit zone and ethereum (ETH) fell below $ 1,600 per coin on Tuesday.

Over the course of Tuesday, both major crypto assets managed to climb above those regions. The next day, August 3, the entire crypto economy grew by just over 2%. Shares and the cryptocurrency economy have started to show a little more volatility as tensions between China and Taiwan rise. Gold is also down this month as one ounce of fine gold was hand traded for $ 1,810 per unit on July 1st and gold is trading for $ 1,765 per unit today.

Analysts say the recent drop in gold is due to a strong US dollar as the DXY index charts show the greenback remains robust after falling last week. “Gold slashed earnings after Wall Street became optimistic that tensions between the world’s two largest economies would get out of hand,” OANDA senior market analyst Edward Moya told Kitco News. “A strong dollar is weighing on gold as well, as the greenback’s withdrawal over the past two weeks appears to be over.”

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What do you think of the statements by various Fed members and the market reaction after the hawkish comments and tensions between China and Taiwan? Let us know what you think about this topic in the comments section below.

Jamie Redman

Jamie Redman is the News Lead of Bitcoin.com News and a financial technology journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open source code and decentralized applications. Since September 2015, Redman has written more than 5,700 articles for Bitcoin.com News on the disruptive protocols emerging today.

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