US Federal Reserve (Fed) Chairman Jerome Powell said that the central bank “doesn’t really see significant macroeconomic impacts” from the high volatility of cryptocurrencies.
Jerome Powell presented to the Senate Committee on Banking, Housing, and Urbanism on Wednesday's "six-monthly monetary policy report to Congress."
Senator Kyrsten Sinema asked Powell if the Fed is monitoring crypto performance given the recent market volatility and what impact cryptocurrencies have on the economic outlook and monetary policy. broader currency of the United States.
“Of course, we are still monitoring every crypto move very carefully,” Powell added. “We don’t see significant macroeconomic impacts from the crypto sell-off.”
The Fed President emphasized that cryptocurrency is an innovative new field, so it needs a better regulatory framework.
In March, the Fed chair said, “Our current regulatory frameworks are not built with the digital world in mind… Stablecoins, central bank digital currencies, and digital finance digital in general. Going forward, there may be changes to existing laws and regulations or even entirely new rules and frameworks for cryptocurrencies.”
Powell also told the Senate banking committee on Wednesday that the central bank is determined to reduce inflation, which he believes the Fed can do.
“At the Fed, we understand that high inflation is causing trouble. We are strongly committed to bringing inflation back down and we are urgently doing so,” he said.
On the possibility that the US economy could fall into a recession, he emphasized, "It is not our expected outcome at all, but it is certainly a possibility, and to be honest, the The events of the past few months around the world have made it difficult for us to achieve what we want, which is 2% inflation and still a strong labor market.”