Inflation is rising, but the Fed has not yet addressed it. “Pushing money” leads people to BTC, Lummis says

The Fed’s announcement seems to have affected some of the mood surrounding BTC. Maintaining the US central bank’s strategy may play a card with riskier investments (this category includes BTC for a large part of traditional investors), but also the growing popularity of this cryptocurrency as a kind of safe haven due to its limited supply properties.

While the Fed’s current strategy may be holding the US economy back and contributing to stock growth and employment growth, it is also marked by strong inflation, which means that Americans’ financial savings and payments are falling at fair value.

The Fed announced in June that it had changed the estimated rise in inflation for this year from 2.4% to 3.4%, with Jerome Powell now confirming that inflation is real and noticeable. In addition, he pointed out, for example, rising prices for used vehicles, air tickets and hotels.

As for a possible change in the Fed’s current strategy, Powell has indicated that there are many indications of future employment growth figures in the United States. “We monitor a wide range of data on various aspects of the labor market. We have something to catch up with. I would like to see some strong numbers about jobs,“ he indicated the moment at which they could begin to re-evaluate their current settings.

Other effects of the coronavirus pandemic may also affect US employment growth. Its new variant, called Delta, may change the situation in the coming months, which could slow down the growth of economic recovery and job creation. “While new strains of this virus are emerging, no one is safe. It is therefore also in our interest to ensure that vaccination is accelerated worldwide, “he warned.

Powell admitted that inflation could rise further

As for inflation, the Fed could slow its growth by raising interest rates. However, Powell added that in the current circumstances, this step is not yet something they would consider a priority. “If you have high inflation, you also have high employment, they tend to go together. This is a situation that is temporary in various ways. We do not have full employment, but we have high inflation. We feel that we will make good progress towards maximum employment over the next year or a few years. “

Anthony Pompliano, a well-known promoter of BTC, drew attention to one of Jerome Powell’s new statements admitting the possibility that inflation may rise even higher and be more lasting than the Fed expected. “This is exactly what the bitcoiners have been saying for more than a year,” Pomp wrote.

“Inflation could turn out to be higher and more persistent than we expect.” – Jerome Powell

Exactly as bitcoiners have been saying for over a year now.

– Pump 🌪 (@APompliano) July 28, 2021

The current steps lead people to BTC, says Lummis

The Fed’s policy and the constant “printing of money” lead to the devaluation of savings held in Fiat currencies, which may motivate some investors to look for a safe haven in BTC. It has a limited amount and a predetermined inflation, which is declining and at the same time unchanged. Many well-known investors as well as several large companies have already invested in BTC, and if the current situation does not change, interest in BTC will continue to grow, according to US Republican Senator Cynthia Lummis.

She wrote on Twitter that large government spending is doing much more to promote and adopt cryptocurrencies than she herself, adding that the devaluation of the US dollar motivates citizens to store value in BTC-type digital assets.

1 addition: Big gov’t spenders are (accidentally) doing far more to accelerate the adoption of digital assets than I am. The debasement of our currency is causing a flight to digital assets like BTC that are a store of value.

– Cynthia Lummis 🦬 (@CynthiaMLummis) July 28, 2021

“But sending America deeper is a stupid, inflationary and undesirable way to motivate people to digital assets” Lummis said, trying to say that she is not happy about the current trend of losing value in the US dollar, although it helps to promote the cryptocurrencies she is a fan of. “I want the dollar to remain a reserve currency. However, we need to change spending and support financial innovation on American soil,” she says.

Lumiss also spoke about this topic at FOX Business, where she said she would like laws to be made in the US that are friendly to BTC miners. So far, something like this can be observed especially in states such as Pennsylvania, Texas or Wyoming.