Although in the near-term it remains incredibly unclear as to where BTC and the aggregated crypto markets are heading next, the Fed Chairman's recent comments about it and its rapid ascent to mainstream discussion is certainly one bullish fundamental factor underlying it.
- 2nd cut expected in September, even after CPI and payrolls rebound. Trump has also explored the legality of demoting Powell from the Fed chair and claimed he has that authority.
The dollar, however, trimmed losses against the yen and euro earlier on Thursday after data showed USA underlying consumer prices rose 0.3% in June, the most in almost 1-1/2 years, with solid gains in the costs of a range of goods and service.
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Singapore's benchmark index was up 0.7 per cent as at 1.09pm.
To the suggestion that the current low USA unemployment rate could lead to a breakout of inflation, Powell noted that the overall pace of price increases remains "muted" and wage gains remain modest, signs the Fed could reduce rates without risk of an overheating economy.
Trump has criticized Powell and his colleagues on a regular basis for nearly a full year - first calling on the Fed to stop, and then to reverse, its 2018 interest-rate increases.
Above: Dollar Index shown at daily intervals.
Though the USA government reported strong job growth for June, other major economies' "data have continued to disappoint".
Lower interest rates decrease the opportunity cost of holding nonyielding bullion and weigh on the dollar, making gold cheaper for investors holding other currencies.
The head of the USA central bank has signalled that a cut interest rates is coming after he warned of growing risks to the global economy. The Fed Funds rate is now 2.5%.
Since Fed officials met last month, when they chose to hold rates steady, "uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the USA economic outlook", he wrote. "Sterling has galloped over 100pts higher since Powell re-affirmed the bond market's desire for rate cuts".
Powell's testimony followed weeks of intense speculation in the market that the US central bank would soon slash borrowing costs for companies and consumers in order to fend off an economic slowdown that some say has been a long time coming, but that has been made more likely by the 2019 escalation of the USA trade war with China.
St. Louis Fed President James Bullard, who voted in favor of a rate cut in June, doesn't see the need for such an aggressive move. On average, the economy has added 172,000 nonfarm payrolls per month between January and June.
A trader shows USA dollar notes at a currency exchange booth in Peshawar, Pakistan December 3, 2018.
"Powell's testimony made sure that there is a rate cut on the cards this month". "This doesn't suggest that the Fed is seriously contemplating the 100bp of rate cuts that financial markets are now expecting by the end of 2020". The current Fed rate is set at 2.25 per cent to 2.5 per cent.
It's raised rates nine times since the end of 2015 but with the growth-boosting effect of 2018's mammoth tax cuts now wearing off and the U.S.
But he warned of economic weakness in other major economies, and a downturn in business investment driven by trade war worries.
Earlier rounds of United States tariffs on trading partners - including China - had been dismissed as of little macroeconomic importance, with the Fed in early May still anticipating its policy rate would remain unchanged for the rest of the year.