U.Today – JP Morgan CEO Jamie Dimon has issued a warning that will have consequences for the markets. This latest warning has left many investors wondering about the implications for various asset classes, particularly cryptocurrencies.
According to CNBC, JPMorgan’s CEO issued a warning about inflation on Friday despite recent signs of easing price pressures. rose more than 2% in today’s trading session, topping $58,000.
“There has been some progress in reducing inflation, but multiple inflationary forces remain ahead,” Dimon said in a statement accompanying the bank's second-quarter results. “Therefore, inflation and interest rates may remain higher than the market expects.”
Dimon's comments come after data this week showed the monthly inflation rate fell in June for the first time in more than four years, fueling speculation that the Federal Reserve could cut rates soon.
Federal Reserve Chairman Jerome Powell expressed concern earlier this week that keeping interest rates too high for too long could harm economic growth, hinting that rate cuts could be on the way if inflation continues to rise.
Will Bitcoin react?
Bitcoin fell to lows last seen in February in trading this week as this year’s record surge shows signs of exhaustion amid a lack of fresh market drivers. Concerns over Mt. Gox, German government bitcoin sales and the possibility of higher U.S. borrowing costs for longer had undermined the cryptocurrency market.
After reaching an all-time high of around $74,000 in mid-March, Bitcoin has since fallen by around 21%. This decline is being helped by fluctuating expectations of interest rate cuts in the United States, which have reduced demand for most risk assets.
Persistent inflation has led traders to lower their expectations for a Federal Reserve interest rate cut this year, posing a challenge for speculative assets like cryptocurrencies. At the time of writing, BTC was up 1.18% over the past 24 hours, trading at $58,527.
In the coming days, the market will be watching closely how the JP Morgan CEO's inflation warning will affect cryptocurrencies.
This article was originally published on U.Today
