Markets rise after Fed chief says it makes sense to slow rate hikes

Markets rose on Wednesday after Federal Reserve Chairman Jerome Powell spoke at the Brookings Institution in Washington. The total market capitalization of cryptocurrencies rose by $3.11 trillion to $860 billion, while the top four stock indexes jumped by $2 trillion to $5 trillion.

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Stock, cryptocurrency, and precious metal prices rise after Jerome Powell's speech

On the last day of November, US Federal Reserve Chairman Jerome Powell offered "a progress report on the Federal Open Market Committee (FOMC) efforts". The Fed chairman's speech at the Brookings Institution in Washington indicated the possibility of a smaller rate hike in December.

„Dává smysl zmírňovat tempo růstu našich sazeb, když se blížíme k úrovni omezení, která budou dostatečná ke snížení inflace. Čas na zmírnění tempa zvyšování sazeb může přijít hned na prosincovém zasedání.“

Stock markets rose after Jerome Powell's speech, and cryptocurrencies and precious metals followed suit. A troy ounce of .999 fine gold jumped 1.15 % higher in the past 24 hours, while an ounce of fine silver rose 4.45 %. Gold is currently trading at $1,770 per ounce and silver at $22.27 per ounce.

Economist Peter Schiff added his observations about Powell's comments Wednesday afternoon. "Investors are no longer buying what Powell is selling," said Schiff on Twitter. Schiff noted that “not only will the economy crash, but it will also be another financial crisis.”

All four major stock indexes also rose Wednesday afternoon after the Fed chairman's speech. The Nasdaq, Dow Jones, S&P 500 and NYSE rose 2.1% to nearly 5.1% against the US dollar.

Powell dodal, že restriktivní politika je stále potřeba, aby bude pokračovat ještě nějakou dobu. „Je pravděpodobné, že obnovení cenové stability bude vyžadovat udržovat politiku na restriktivní úrovni po nějakou dobu,“ uvedl Powell. „Historie důrazně varuje před předčasným uvolňováním politiky. Budeme pokračovat, dokud nebude práce hotová,“ dodal předseda Fedu.

Powell expects the final peak in rates — the “terminal rate” — to be “somewhat higher than thought” when FOMC members set their latest projections in September. At the time, FOMC members had expected the final rate to reach 4.6 percent. Markets now see it in a range of 5-5.25 percent, according to CME Group data.

Cryptocurrencies also rebounded after Powell's speech, as the market capitalization of all cryptocurrencies rose by $3.11 trillion on Wednesday afternoon. Bitcoin (BTC) rose above the $17,000 level and gained $3.43 trillion against the dollar. Ethereum (ETH) jumped by $5.66 trillion on Wednesday, approaching $1,300.

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All content in this article is for informational purposes only and does not in any way serve as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.