Bitcoin (BTC) is still struggling to break above $43,000, but the price has recovered somewhat from Monday’s decline. On Wednesday, the chairman of the US Federal Reserve surprised friends and foes alike by suddenly talking about interest rate cuts.
There’s more good news on the central bank front, as the People’s Bank of China is currently pumping record amounts of new money into the economy to support the ailing real estate market. Therefore, Asian stocks are currently performing very well.
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Anycoin Direct
Global liquidity is rising, Bitcoin is enjoying it
The policies of global central banks are slowly changing and the Bitcoin price is clearly enjoying this. The chart below shows how global liquidity has seen a fantastic increase over the past few days (yellow line).
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What does this mean for the Bitcoin price?
Global liquidity reflects the growth of the balance sheets of all major central banks in the world. Usually, it is a good sign for Bitcoin price when liquidity increases.
In this respect, the departure from the strict language of US Federal Reserve Chairman Jerome Powell and the cash injections from the Chinese central bank are a plus for the markets.
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Not everyone believes the central bankers anymore
However, not everyone believes that central bankers will win the battle against inflation. “Markets are not far wrong in reacting so positively to such statements from central bankers who have a reputation for following the music,” Steven Major of HSBC Holdings told Bloomberg Television.
Steven Major is referring to the fact that central banks often only act when it is actually too late. He seems to be suggesting that interest rates will likely need to be cut much more quickly due to an impending recession.
The fact that China is currently supplying the market with huge amounts of capital seems to be a good development for the Bitcoin price.
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