Table of contents
ToggleU.S. stocks rose after FOMC meeting
The Federal Reserve announced an interest rate decision last night, maintaining the target range for the federal funds rate at 5.25% to 5.50%. However, Fed Chairman Powell’s dovish tone at the press conference hinted at the possibility of starting to loosen monetary policy in September. Powell said at the press conference:
"A rate cut could be discussed as early as the September meeting. We are getting closer to the time to appropriately lower rates, but we are not there yet."
On the other hand, "Wall Street Journal" reporter Nick Timiraos, who is known as the "Fed's mouthpiece", pointed out when interpreting the Federal Reserve's statement that the Federal Reserve has deleted the language describing the risk of inflation as "highly concerned" in the past two years. This suggests that inflation may no longer be an obstacle to rate cuts, especially as the U.S. labor market continues to cool.
The FOMC meeting strengthened investors' confidence in interest rate cuts in September, driving a rebound in U.S. stocks, with major indexes closing higher across the board.
Cryptocurrencies like Bitcoin perform dismally
However, in comparison, Bitcoin and the broader cryptocurrency market failed to keep up with this trend, and instead further intensified the downward trend, with Bitcoin even falling below the $64,000 mark this morning.
Zach Pandl, director of research at Grayscale, said the different performance between different asset classes after the FOMC meeting may be due to traders' positioning before the meeting.
Zach Pandl pointed out that stocks may be slightly undervalued after the recent market decline, while Bitcoin has experienced a period of strong growth and steady inflows, while gold has rebounded after a period of weakness. He concluded:
“From a broader perspective, the Fed’s interest rate cuts, bipartisan attention on cryptocurrency policy issues, and a possible second term of the Trump administration may lead to a weakening of the U.S. dollar and should be viewed as important for Bitcoin. A very positive sign.”
About GT Radar
GT Radar focuses on building a quantitative investment portfolio with long-term and stable growth, and has more than 10 years of quantitative trading experience in the stock market and cryptocurrency. The trading system integrates more than 150 strategies and is designed to provide extremely high adaptability and flexibility to ensure profits from the market in the most robust way.
