Cryptocurrencies started the new day with a rise, attributed to a ceasefire, which Trump promised to uphold. Although missiles were fired in the early hours, Iran announced it had not sent any missiles following the ceasefire. As of the time of writing, Bitcoin 
$77,710 was over $105,000 and had seen a rise to $106,000 in the last 24 hours. Today, Powell is addressing Congress, and his speech contains important details.
Fed Announcements
Three Fed members mentioned potential interest rate cuts in July over Friday and Monday. These statements highlight the significance of the PCE data to be released on Friday, crucial to understanding whether the Fed will delay cutting rates due to the weakening in new job opportunities, provided inflation does not increase significantly.
“The conditions in the labor market have remained robust. Payroll employment gains averaged 124,000 monthly over the first five months of the year. The unemployment rate stood at 4.2% in May, remaining low and narrow throughout the past year. Wage growth continues to be moderate but remains above inflation. Overall, a broad set of indicators suggests the labor market conditions are generally balanced and consistent with maximum employment.” – Powell
Inflation has significantly eased from the high levels seen in mid-2022; however, Powell remains concerned about rates above his long-term 2% target.
Implications for Cryptocurrencies
Powell did not signal a rate cut, aligning with the announcements from the three Fed members in recent days. This suggests that if a rate cut does not occur in July, it may indicate a decision not reached unanimously by the FOMC.
There is an 83% expectation that interest rates will remain unchanged when announced in 36 days. The forecast of a rate cut in September exceeds 80%. The FedWatch data, indicating we might see two rate cuts before the year’s end, can rapidly change depending on tariff-related developments. Long-term trade agreements by the U.S. with China, the EU, India, and other countries, maintaining a minimal long-term fixed tariff rate, will provide a strong signal for rate cuts.
