Bitwise European Head of Research André Dragosch said in an interview with The Block:

“The appreciation of the dollar could limit bitcoin’s upside, as the historical performance of bitcoin tends to suffer during periods of dollar strength. Additionally, dollar appreciation often signals tighter global liquidity, which could be a headwind for bitcoin in the near term.”

“What is more is that our own quantitative models imply that the US Dollar is currently the most important macro factor with respect to the performance of Bitcoin and monetary policy as well as global growth expectations have become less important lately.”

According to TradingView, the U.S. dollar index rose from 103.42 to 105.93 on election day.

The Impact of Interest Rate Investors Lowering Rate Cut Expectations on Bitcoin

The recent macroeconomic developments can significantly impact Bitcoin by influencing investor risk appetite and market liquidity. When investors lower their expectations for interest rate cuts by the U.S. Federal Reserve, this supports the strength of the dollar. A stronger dollar can make alternative assets like Bitcoin less attractive, potentially dampening demand and slowing price growth.

Another factor to consider is the expectation that the Bank of Japan (BoJ) will raise interest rates. Such expectations have caused the yen to strengthen against the dollar. Similar shifts have previously led to market events like the unwinding of the yen carry trade in August, which triggered major liquidations in risk assets, including Bitcoin and the broader crypto market.

Data released last Friday showed that consumer prices in Tokyo rose for the first time in three months, reinforcing the likelihood of a BoJ rate hike in December. BoJ Governor Kazuo Ueda noted that Japan’s economy is moving towards wage-driven inflation and emphasized the need to avoid keeping borrowing costs too low.

These developments could further influence market dynamics, creating potential headwinds for Bitcoin’s price growth.

You can also freely share your thoughts and comments about the topic in the comment section. Additionally, don’t forget to follow us on our Telegram, YouTube, and Twitter channels for the latest news and updates.

The post Bitwise Analyst: The Impact of a Strong Dollar on Bitcoin’s Rise appeared first on Coin Engineer.

Waller stated that the timing and size of interest rate cuts should be carefully evaluated. Especially in an environment where inflation is not declining, sudden interest rate cuts may have undesirable consequences. This situation poses risks for the future of the economy.

Waller also pointed out that the Fed’s interest rate policies should be consistent with the broader economic outlook. If high inflation persists, there should be no rush to cut rates, he said. She emphasized that the Fed should carefully monitor developments in the economy and inflation rates.

On the other hand, while some economists find Waller’s statements positive, others think that the Fed may need to cut rates further. However, Waller emphasized the importance of being cautious on this issue and stated that the markets should take this situation into consideration.

You can also freely share your thoughts and comments about the topic in the comment section. Additionally, don’t forget to follow us on our Telegram, YouTube, and Twitter channels for the latest news and updates.

The post Important Statements from Waller on Interest Rate Cuts! appeared first on Coin Engineer.