fed It takes decisive and fast steps to balance supply and demand and to keep inflation expectations under control. Chairman of the Board, Jerome Powell, said such a policy would require maintaining high rates for some time.

The Fed chairman explained that the longer high inflation persists, the more likely it is to consolidate at a high level. He added that the decline may require a period of sustainable growth below the trend.

“Successful disinflation [главы ФРС в прошлом] Volker in the early 1980s […] It required a long period of extremely restrictive monetary policy. […] Our aim is to avoid this outcome by acting decisively now.”

The extent of the rate hike in September will depend on the data. However, the Fed chairman stressed that easing price pressure was “not enough” in recent reports. He admitted that at a certain stage, the Central Bank would slow down the pace of tightening monetary policy.

The Fed chairman’s speech was a little more hawkish, but generally echoed his theses at the press conference after the July meeting.

The market was expecting a slightly more aggressive rhetoric. With the latest macroeconomic data, the probability of a “softer” increase in key interest rate in September increased from 36% to 43.5% compared to the last day.

The cryptocurrency market reacted weakly to the Fed chairman’s speech. Bitcoin exchange rate bounced back from intraday highs but remained in intraday range. At the time of writing, the asset is down 1.6% in the last 24 hours (CoinGecko).

Recall that Mike Novogratz, head of Galaxy Digital, predicted Bitcoin to be protected in the $20,000-30,000 range.

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