Crypto Markets Stagnate as Powell Remains Neutral on Tariffs
1min read Crypto markets remained relatively stable on Friday, with minimal price fluctuations observed throughout the day. This period of stagnation coincided with a speech delivered by U.S. Federal Reserve Chairman Jerome Powell at a conference in Virginia. Powell adopted a neutral tone regarding the central bank's monetary policy, acknowledging the current economic climate as highly uncertain with elevated risks of both higher unemployment and inflation.
Powell emphasized that the Fed's role is not to comment on policy choices but discussed the potential economic impacts of President Donald Trump's recently imposed tariffs. These tariffs, which are significantly larger than anticipated, could lead to higher inflation and slower economic growth. The exact magnitude and duration of these effects remain unclear, but Powell assured that the Fed is committed to keeping longer-term inflation expectations well-anchored to prevent a one-time price increase from becoming a persistent inflation problem.
The Fed chair also stated that the central bank will continue to monitor economic data and the evolving outlook before considering any adjustments to its policy stance. Powell's remarks came as Trump signed an executive order imposing a 10% baseline tariff on all imported goods entering the U.S., with the aim of protecting domestic manufacturing. Additionally, Trump issued a proclamation detailing "reciprocal tariffs" on dozens of specific countries, with rates totaling up to 54% on China.
Ask Aime: What is the potential impact of the recent tariffs imposed by President Trump on the crypto market?
Powell's neutral stance and the uncertainty surrounding the economic impacts of the new tariffs contributed to the sideways movement in crypto markets. Investors are awaiting further clarity on the Fed's policy direction and the potential consequences of the tariffs on the economy. The overall crypto market cap saw a slight decline of 1.2% on Friday, while stocks experienced more significant losses. The S&P 500 dropped by 5.97%, the Nasdaq Composite plunged by more than 6%, and the Dow Jones Industrial Average fell by 5.5%.
