Jerome Powell Announces Interest Rate Cuts, Here's The Impact On Crypto Market!

Jerome Powell generalizes cut in interest rates (Photo; Doc. CNBC)

JAKARTA - Federal Reserve chairman Jerome Powell announced a 50-base-point interest rate cut (BPS) for the first time in four years. This decision was taken as part of an effort to maintain economic stability amid global uncertainty and inflation that continues to subside. The move is expected to affect various sectors, including the crypto market known to be very sensitive to monetary policy changes.

In his speech, Jerome Powell confirmed that the cut in interest rates was carried out as part of a looser monetary policy, with the aim of maintaining labor market power amid moderate economic growth and inflation that continues to subside. Although the target for Federal Reserve inflation remains at 2%, Powell is optimistic that with proper policy adjustments, the United States economy will remain on a stable track.

The Federal Open Market Committee (FOMC) today decided to lower the policy interest rate by half percent. This decision reflects our belief that with the right policy calibration, labor market power can be maintained, while inflation moves continuously towards 2%," Powell said.

Powell also stressed that the labor market in the last three years has shown strict conditions, with top priorities fixed on efforts to reduce inflation. He stated that the current macroeconomic condition is quite positive, and the Fed's monetary policy is still well maintained.

The reduction in interest rates by 50 BPS, according to Powell, is the right step, supported by economic data and a revised benchmark for the future. Although this is the first cut in years, he stressed that the next decision will be made based on the evaluation of each meeting, whether it is further pruning, maintaining, or possibly rising interest rates.

However, a number of market observers feel that this cut in interest rates is too fast. In this regard, Powell emphasized that the decision had been taken carefully and did not reflect signs of urgency. He also added that the Federal Reserve will continue to monitor the development of inflation and adjust policies according to market conditions.