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Federal Reserve May Delay Interest Rate Recovery Due to Inflation

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On February 21, according to the Bitlinex Alpha report, data showed that the Federal Reserve may raise interest rates by more than 25 basis points in the futur…

Federal Reserve May Delay Interest Rate Recovery Due to Inflation

On February 21, according to the Bitlinex Alpha report, data showed that the Federal Reserve may raise interest rates by more than 25 basis points in the future. Inflation intensified in January this year. Although the overall CPI fell year-on-year, some categories of consumer spending showed that inflation continued. All these factors together, the Federal Reserve may delay the recovery of the target interest rate of 2%.

Bitfinex Alpha: In the fluctuation of Bitcoin, inflation rises again

Analysis based on this information:


The Bitlinex Alpha report released on February 21 brought to light the possibility of the Federal Reserve increasing interest rates by over 25 basis points in the future. This may be due to the fact that inflation has intensified in January of this year. Despite an overall year-on-year fall in the Consumer Price Index (CPI), inflation has still been observed in specific categories of consumer spending.

One factor that may contribute to this development could be the ongoing COVID-19 pandemic, which has had a significant impact on the economy. Many businesses were forced to shut down or scale back their operations, which reduced the supply of goods and services, resulting in increased prices. Additionally, with millions of people losing their jobs, the overall demand for goods and services has also decreased. However, while the demand for certain items may have fallen, the overall price of goods and services went up. This is because of the fact that there were goods and services that were still in demand, and the reduced availability of these items has raised their price.

Furthermore, the report suggests that the Federal Reserve may hold off on increasing interest rates to reach its target of 2% due to the inflation that has been observed in January. This could delay economic recovery and may be detrimental to businesses that had anticipated an increase in lending rates. Inflation can also signal a decline in purchasing power, which can be a challenge for consumers who may have anticipated a stable price level.

In conclusion, the Bitlinex Alpha report has indicated that the Federal Reserve may need to carefully consider the economic situation given the possibility of increasing inflation. The report highlights that a delay in the target interest rate of 2% may be in order. This could help address any potential adverse effects that inflation may have on the economy, such as reduced economic activity, lower purchasing power, and potential challenges to businesses.

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