As Bitcoin enthusiasts brace for yet another volatile week, all eyes are on Federal Reserve Chairman Jerome Powell, who is set to deliver his semi-annual monetary policy testimony to Congress. Scheduled for this week, Powell’s address comes amid swirling debates over interest rates and inflation, with the ever-looming threat of geopolitical unrest adding another layer of complexity to market calculations.
Powell’s Testimony: A Focal Point
Powell’s testimony is expected to be a high-stakes affair, as Republican lawmakers gear up to challenge him on the Federal Reserve’s interest rate policies. President Trump, through his Truth Social posts, has repeatedly criticized Powell for not lowering rates—a move he claims could save the country billions. Powell, however, is likely to stand firm on the Fed’s independence, emphasizing a data-driven approach to future rate decisions.
Analysts are keenly parsing Powell’s remarks for any dovish signals. Such hints could ignite risk-taking across financial markets, potentially boosting Bitcoin, which has impressively held its ground above the $100,000 mark despite recent Middle Eastern tensions. “With early signs of softening in the labor market and weak housing activity, the Fed might lean towards a dovish stance in July,” Chris Weston from Pepperstone explained on X. Such a shift could pave the way for a rate cut in September—a scenario already anticipated by the U.S. swaps market. For more insights on potential Bitcoin price movements, see our article on Bitcoin price levels ahead of Fed Chair Powell’s speech.
Core PCE and Inflation Jitters
Adding to the week’s intrigue is the upcoming release of the core personal-consumption expenditures (PCE) price index, slated for Friday. This index, the Fed’s preferred measure of inflation, is forecasted to show a modest 0.1% month-over-month rise for May, translating to an annualized growth rate of 2.6%. Market players are eyeing these figures closely, as a benign increase could bolster rate cut speculation.
However, not everyone is convinced. ING analysts caution that the true inflationary impact of President Trump’s tariffs—set to resume on July 9 after a 90-day hiatus—may not fully manifest until later in the year. They suggest that the December FOMC meeting could be the earliest point for any real clarity on inflation dynamics. “If the job market continues to weaken, we might even see a 50 basis-point cut,” ING’s team noted, adding layers of uncertainty to an already fraught landscape. This aligns with predictions that a Bitcoin rally to $120K is possible if Fed eases rates due to tariff and war impact.
Tensions in the Oil Market
Meanwhile, the oil market, though calm for now, remains a potential wild card. The recent U.S. airstrike on Iran’s nuclear sites has not yet triggered the price drop some bears predicted for Bitcoin. Yet, the situation is far from resolved. Iran’s persistent threats to close the Strait of Hormuz—a critical artery for global oil supply—could ramp up shipping insurance costs, inadvertently driving oil prices higher.
“By simply suggesting they could disrupt this crucial channel, Iran could significantly inflate maritime costs,” Weston remarked, acknowledging the ripple effect this could have on crude and gas supplies. According to reports, insurance costs for vessels navigating the strait have already quadrupled, hinting at possible future turbulence.
Looking Ahead
As the week unfolds, traders and analysts alike will be dissecting every word from Powell’s testimony and every decimal point from the PCE data. Will the Fed signal a dovish pivot? Could geopolitical tensions reignite oil market volatility? These questions linger, leaving the crypto market on tenterhooks.
While Bitcoin has demonstrated resilience, holding steady above $100,000, the market’s future trajectory remains uncertain. The interplay between monetary policy, inflationary pressures, and geopolitical developments will be pivotal in shaping the next chapter for cryptocurrencies. As always, the only certainty seems to be uncertainty itself.
Source
This article is based on: Bitcoin Week Ahead: Focus on Powell’s Testimony, U.S. Core PCE as Tariff Deadline Looms
Further Reading
Deepen your understanding with these related articles:
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- Crypto Daybook Americas: Bitcoin Shrugs Off Fed, Mideast War, but Derivatives Flash Caution
- Bitcoin Quickly Plunges Below $103K, With Volatility Burst Spurring $450M in Crypto Liquidations
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
