Friday, December 3

Powell’s re-election and the future of bitcoin

The continuity of Jerome Powell at the head of the Federal Reserve (Fed) is the focus of the daily podcast of “They had another alternative, [Lael] Braynard, but the difference is small ”, explains Miguel Ángel Rodríguez, currency expert and regular analyst at the Investment magazine.

“They are both dovish, favorable to lower interest rates,” he says.

In an environment of rates close to or below 0 percent, one of the doubts for currency investors lies in where to find the highest returns, in addition to the euro / dollar. Rodríguez gives one of the keys and points to Japan.

“The dollar exchange against the yen is one of the most profitable ones. After the news of Powell it has reached a resistance level at 114.50. If it breaks it, it has a long upward path, much to the joy of the Japanese Ministry of Finance ”, explains the expert.

“The only thing to keep in mind is that there could be a correction, for example, if risk aversion from the pandemic returns. IN that case the rise would be slowed down ”, he points out.

Asked about the Turkish lira, which depreciates 60 percent in the year, the analyst anticipates that “it is most likely that it will continue to weaken.” “The Turkish central bank has been unorthodox in lowering interest rates,” says Rodríguez.

Cryptocurrencies, a still emerging market

The expert also analyzed the situation of the cryptocurrency market, which in the last week registered strong falls, especially in the most traded ones such as ethereum or bitcoin.

“It is an emerging market. For those of us who have been in the foreign exchange market for so long, it has cost us a bit, but it is gaining more and more strength ”, says the expert.

“They are gaining confidence despite the restraints and the sticks from China. It can be a good investment asset, ”says Rodríguez. The only handicap, according to the analyst, is the great volatility of this type of currency.

Episode credits

Direction: Ismael García Villarejo // Presentation and production: José Jiménez // Realization: Gabriel García Guio // Recorded in Madrid on November 22, 2021

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