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Although it was already known that the FED would reduce repurchase levels, this change change — a concept relevant to cryptocurrencies that use the UTXO model — is the number of coins sent back to a user after they use their unspent outputs to initiate a transaction. would mean that the program would officially come to an end in early 2022. It is believed that an increase in interest rates could come later, due to rising inflationary levels.
LaUS Federal Reserve (FED)the main body responsible for the country’s monetary and financial reforms, said today that it would double the pace at which it has been reducing the purchase of U.S. Treasury bonds.Tesoro and mortgage-backed securities, leaving this figure at about $30 billion per month, with the intention of officially completing this measure early next year.
FED will reduce bond buybacks
This was confirmed by the agency in a meeting held today, where it indicated that these measures seek to favor the nation’s economic indicators, proposing a much faster pace of implementation than originally contemplated in previous meetings and speeches, since the bond repurchase program was originally scheduled to end in mid-2022.
Al respecto, durante una conferencia de prensa celebrada después de la reunión de la FED, state agency director Jerome Powell commented:
“Economic developments and changes in the outlook justify this evolution in monetary policy. The economy has advanced rapidly and employment indicators have reached record highs.”
Let’s keep in mind that this measure would imply an important change with respect to the conditions announced in September of this year, where Powell indicated that the FED would continue its program although it would gradually reduce the reinvestment in bonds and securities, this to the extent that economic indicators were improving progressively.
Possible increase in interest rates?
However, given the fact that the agency kept bank interest rates close refers to the closing price; similar to the same term used in stock trading. to zero, analysts and enthusiasts contemplate the possibility that this could change before 2023, especially in light of the increase in inflationary levels falling on the local currency.
Faced with this possibility, Powell has repeatedly commented that interest rates would remain close to zero until at least 2023, although changes in the pace of bond and security the term securities refers to a fungible and tradable financial instrument that carries a type of monetary value. repurchases were anticipated, but inflationary levels and the repercussions on the local economy could generate imbalances that would need to be addressed appropriately before they have a greater impact.
Faced with the possibility of a rise in interest rates, the chief economist atGrant Thornton LLP, Diane Swonk, comentó:
“With inflation a general increase in prices and fall in the purchasing value of money. having exceeded 2% already for some time, the committee expects that it is appropriate to maintain this target range until labor market an area or arena, online or offline, in which commercial dealings are conducted. conditions have reached levels consistent with the employment committee’s assessments.”
More aggressive measures against inflation
After Powell’s re-election as President of the United States, theFED, political sectors in the U.S. have been putting pressure on the company’s management.Reserva Federal to take more aggressive measures against the current inflationary phenomenon.
Analysts and enthusiasts suggest that there could be a change in Powell’s outlook, precisely because he doesn’t feel that his actions could compromise his stability in office. This was indicated by the CEO ofGalaxy Capital, Mike Novogratz, who at the time claimed that this could be counterproductive for both traditional markets and the crypto sector:
“We have inflation that’s rising… in a pretty bad way in the US. So, we can see, the Fed will have to move a little bit a bit is a basic unit of information in computing. faster… That should slow down all assets. It would slow down NASDAQ. It would slow down cryptocurrencies if we had to start raising rates a lot faster than we think.”
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Version by Angel Di Matteo /DiarioBitcoin