Fed Chair Powell News Rocks Crypto and Stocks: Bitcoin Slips to $22,120
• Crypto and stocks reacted negatively to comments about US inflation by Fed Chair Jerome Powell.
• Bitcoin traded to lows of $22,120 while the S&P 500 fell 1%.
• Investors are now likely to turn their attention to the next Fed meeting in March.
Crypto Turns Red After Powell’s Comments
Fed Chair Jerome Powell’s remarks on US inflation caused a negative reaction in crypto and stock markets. Bitcoin dropped to 24-hour lows of $22,120 while the S&P 500 fell by 1%. Investors will now be looking ahead to the next Federal Reserve meeting in March.
Impact on Crypto Markets
On Tuesday, crypto markets reacted negatively after Federal Reserve Chair Jerome Powell gave his prepared testimony before Congress about interest rates. Bitcoin traded towards support at $22,100, and Ethereum dropped to around $1,540. Across the board, crypto prices took a hit from Powell’s comments.
Impact on Stock Markets
US stocks also felt the impact of Powell’s remarks as investors appeared to have been spooked by his comments on interest rates. The S&P 500 dropped 1%, while the Dow Jones Industrial Average and Nasdaq Composite both shed 0.6% and 0.9% respectively. Economists noted how market reactions shifted away from previous dovish mentions at press conferences toward hawkish tones based on these new metrics suggesting a need for faster tightening if necessary.
Attention on Next Meeting
As investors assess the implications of Powell’s remarks, they are likely to turn their attention toward the upcoming Federal Reserve meeting in March where further details may be released regarding US monetary policy decisions going forward. This news could have far-reaching implications for both stock and crypto markets alike, depending on what is decided during this meeting and any subsequent discussions that may take place afterward.
Overall it seems that stock and crypto markets had similar negative reactions when faced with potential higher interest rate announcements from Federal Reserve Chair Jerome Powell early Tuesday morning. Cryptocurrencies like Bitcoin saw significant dips as investors anticipate what might come out of the next Fed meeting in March which could have major implications for both stock and cryptocurrency markets going forward into 2021