Trump said he would make big announcements about artificial intelligence this week, and we haven’t seen anything big yet that would cause an uptick. Cryptocurrencies tend to fall as AI companies decline, and sometimes accompany them as they rise. Today’s decline was also largely related to Oracle.
Why Did Cryptocurrencies Fall?
Artificial intelligence We talked in detail about the concerns about the future of companies and the investment cycle within them. These concerns were reignited again because Oracle’s earnings report was not at all as expected. Oracle shares fell as cloud computing revenue reignited concerns about aggressive spending on data centers. US stock market futures retreated, while technology stocks also fell in Asia and Europe.
US futures are still down and BTC He is trying to protect 90 thousand dollars. While the Fed’s division feeds concerns about interest rate cuts next year, tensions between the USA and Venezuela increased with yesterday’s oil tanker seizure. While the possibility of a possible peace agreement between Ukraine and Russia decreased with the statements of the parties, this situation also had a negative impact on cryptocurrencies.
Fed Confusion
Powell While explaining the reasons for the discount decision yesterday, he clearly expressed why this was extremely difficult. Four officials dispute the Fed’s consensus, as seen in the dotplot, and 7 were not willing to cut rates next year. It is bad that 7 out of 19 Fed members are not willing to cut, but it does not represent a quorum for this decision.
trump He expressed his discomfort because the discount was still low and said that he would bring someone to the institution to reduce the interest rates. However, unless the Fed undergoes a major institutional transformation, interest rate cuts will not be as easy as expected despite Powell’s departure. Therefore, it is being investigated whether the members appointed by Biden were approved with autopen. If hawkish members like Cook were appointed with e-signature, Trump will try to cancel these appointments and replace them with dovish members. It’s unlikely.
If Trump wants more interest rate cuts, he has two options. What if economy It will weaken significantly and layoffs will reach record levels. As a matter of fact, this election year could turn out to be a terrible report card for Trump. Or we will see a meaningful improvement in inflation.
KPMG chief economist Diane Swonk says that if there is no major change in the structure of the Fed, we will see strong resistance to cuts.
