Bloomberg Analyst: Tightening Fed Monetary Policy Could Make Bitcoin A Better Commodity In 2022

Bloomberg chief economist Mike McGlone said when the signal for the Fed to tighten monetary policy in 2022 could have a negative impact on the short term, such as commodity prices. - active reserved for the moment. .

Bloomberg's January issue of Crypto Outlook described the Fed's plans to raise prices in 2022 as a "win-win situation for [comparable] Bitcoin markets." The reason is that the S&P 500 is now experiencing its biggest rise in over 20 years against its 60-month moving average, and Bitcoin, an anti-inflation tool, is increasingly the subject of multiple calls.

McGlone said, "Tense markets have developed, but commodities and Bitcoin are like the early market leaders. It's a question of bull market time and I think the benefits of cryptocurrencies will increase."

Reports from the Fed's policy meeting in December indicated that bank executives were prepared to resist supportive support at a faster rate than expected. At the very least, current plans include a threefold increase in interest rates in 2022 when the Fed's bond balance falls, which now holds nearly $ 8.3 trillion in treasury bills and on loan. .

Markets may overreact in the short term, but it's hard to overstate the hawkish nature of the Fed minutes.

It is possible to reduce QE and raise interest rates three times, but raise prices three times to speed up many decisions that are not on nobody's mind.

--Alex Krüger (@krugermacro) 6 january 2022

While the decision on the support measure is generally viewed as negative for risky assets (a broad group including commodities and cryptocurrencies), McGlone believes that Bitcoin has a unique advantage in these areas and can be successful.

“Cryptocurrencies are the riskiest and most predictable. The risk of asset loss will help the Fed prevent inflation. Bitcoin, a global asset, could be the big beneficiary of this situation.

Bloomberg analyst said he expects "big three" to become the leader in the cryptocurrency industry throughout the year: Bitcoin, Ethereum and the US Dollar Bond Stable .

BTC / USD shows lower, pulling back after the Federal Open Market Committee (FOMC) report was released.