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Traders Bet on Fed to Focus on Financial Stability

Markets are now betting that financial stability will be the new keyword for the US Federal Reserve, as short-term inflation takes a backseat.

Image: Blockhead

Despite the higher US inflation numbers on Tuesday, the US banking crisis as a result of the failure of three banks is what is driving that shift in expectations.

On Tuesday, world stocks stopped falling for the first time in five days when bank shares went up and closely watched US inflation data was in line with predictions.

This made it more likely that the Fed will only raise interest rates by a small amount at its meeting next week.

Bitcoin's price went over $26,000 for the first time since June. This happened because people are getting more hopeful that the digital asset market can survive the recent changes in the US banking system. Bitcoin hit a nine-month high, taking gains past 30% in four sessions.

The rally in cryptocurrencies, though, has faded.

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