Last week, the Federal Reserve’s employment data confirmed that a rate cut would not occur in July. This week, uncertainties regarding tariffs began to dissipate. However, the initial news is not promising, leading Bitcoin 
$62,511 to remain below $108,000. So, what does the future hold for cryptocurrencies?
US Unveils Tariff Plans
In April, President Trump announced shocking tariff rates, including a 46% tariff on Vietnam and 24% on Japan. As of now, Vietnam, after securing a trade agreement, has reduced its rate to 20%. Conversely, Japan, having failed to reach an agreement, faces a 25% tariff on all products starting August 1st.
The Vietnam agreement last week was seen as hopeful. However, the tariffs announced on July 7 signal sustained high rates. The stock market experienced declines due to tariff rates reaching up to 40%. Concerns are mounting about a prolonged downturn, especially as the market drops from its all-time high (ATH).
Following Elon Musk’s announcement of founding a political party, Tesla’s shares plummeted by 7%, exacerbating the market’s decline amidst uncertainties regarding the company’s future.
Moreover, President Trump threatened additional tariffs on nations aligning with “anti-American BRICS policies,” shaking emerging markets. Countries like Malaysia and Kazakhstan will face a 25% tariff, South Africa 30%, and both Laos and Myanmar 40%. White House Press Secretary Leavitt indicated that more countries would receive tariff notifications, unsettling investors further.
The Future of Cryptocurrencies
The European Union has yet to finalize its stance. EU sources suggest negotiations are ongoing and a preliminary agreement might be reached this week. However, official moderate announcements are necessary beyond the unnamed sources. If the process results in a tariff letter for the EU, new projections will be crafted to assess impacts on inflation.
This week, decisions on rates for all countries are expected. Consequently, the Federal Reserve will have sufficient data to evaluate the effect of tariffs on inflation, paving the way for more realistic roadmaps for potential rate cuts and providing markets a clearer outlook.
In summary, the situation isn’t great at the moment. Nevertheless, while sustained high rates are slightly lower than in April for some countries, they generally remain similar. The outcome of EU discussions will be crucial, given the trade volume between the two regions.
