Tevarak
Bitcoin (BTC-USD), Ethereum (ETH-USD) and other major cryptocurrencies are extending their powerful rallies, which were observed after Federal Reserve Chair Jerome Powell hinted on Wednesday that the pace of rate hikes could be slower when economic growth slows.
away around 12:45 p.m. ET, Bitcoin (BTC USD) jumps 10.5% to $23.8K after previously hitting a session high of $23.94K. and ether (ETH USD) increases 16.1% to $1.72,000 in early Thursday afternoon trading after hitting an intraday high of $1.74,000.
The continued gains come after US real GDP entered negative territory for the second straight quarter, contracting 0.9% from -1.6% in the first quarter. The consecutive negative readings are commonly referred to as a “technical recession.”
While recessions are not a desirable outcome, bad news is good news in this case, as speculators’ expectations for future rate hikes are fading amid looming recession fears. Still, Powell stressed during his Wednesday news briefing that “I don’t think the US is in a recession right now” as the economy is still creating jobs.
Specifically, according to CME’s FedWatch tool, markets are pricing in a 74.0% chance that the Fed will hike interest rates by 50 basis points at its Sept. 20-21 meeting. That would be a slower move than the Fed’s recent hike of 75 basis points to bring inflation down.
As for the bullish price action in cryptos, “one could argue that this optimism reflects investors’ view that a more aggressive plan of action from the Federal Reserve was expected, especially given the great political pressure being placed on governments to address inflation (not that the two should be linked!),” wrote Ben Small, an analyst at digital asset broker GlobalBlock, in a note.
More cryptos: Ripple (XRP-USD) +9%cardano (ADA-USD) +8.6%Solana (SOL-USD) +13.3%Dogecoin (DOGE USD) +8.5%dotted (DOT USD) +15%Polygon (MATIC-USD) +14.5% and Uniswap (UNI-USD) +35.2%.
Crypto-related stocks like Galaxy Digital (OTCPK:BRPHF) +7.9%Marathon Digital (MARA) +8.2%Core Scientific (CORZ) +7%MicroStrategy (MSTR) +3.4% and Coinbase Global (COIN) +4.7% are also rising as all three major US stock indices extend gains.
Earlier this week (July 27), Bitcoin jumped higher along with stocks following the Fed’s rate hike, Powell noted.
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