U.Today – JPMorgan CEO Jamie Dimon has issued a market-impacting warning, with this latest warning leaving many investors wondering about the impact on various asset classes, especially cryptocurrencies.
According to CNBC, the CEO of JPMorgan issued a warning about inflation on Friday, despite recent signs that price pressures have eased. The index rose more than 2% in today’s trading session, surpassing $58,000.
“While we have made some progress in reducing inflation, multiple inflationary forces remain in our way,” Dimon said in a statement accompanying the Fed’s second-quarter earnings call. “As a result, inflation and interest rates may remain higher than markets expect.”
Dimon’s comments came after data released this week showed monthly inflation fell to its first rate in more than four years in June, raising speculation the Federal Reserve could soon cut interest rates.
Federal Reserve Chairman Jerome Powell expressed concern earlier this week that keeping interest rates high for a long period of time could be detrimental to economic development, and suggested interest rates could be cut if inflation continues to rise.
Will Bitcoin react?
Bitcoin fell to its lowest since February in trading this week, showing signs of exhaustion after this year’s record rally was spurred by a lack of new market drivers. Mt. Gox, the German government’s bitcoin selloff and concerns over a prolonged rise in U.S. borrowing costs had weakened the cryptocurrency market.
Bitcoin has fallen about 21% since hitting an all-time high of about $74,000 in mid-March, driven by fluctuating expectations of a U.S. interest rate cut that reduced demand for most risk assets.
Persistent inflation has led traders to lower their expectations for Federal Reserve interest rate cuts this year, posing a challenge for speculative assets such as cryptocurrencies. At the time of writing, BTC is trading at $58,527, up 1.18% over the past 24 hours.
Over the next few days, markets will be watching to see how the JP Morgan CEO’s inflation warning will impact cryptocurrencies.
This article was originally published on U.Today
