Political tension over the Suez Canal affects the interest rate decision of the US Federal Reserve (FED) and indirectly the cryptocurrency market.
FED’s statements in recent months December 13, 2024 until interest rate cuts three times He gave the signal that he was leaving. This situation is at first cryptocurrency market reflected positively on risk markets, including rises had triggered it.
But the trade route between Europe and Asia, which started weeks ago and connected the Mediterranean to the Red Sea, Tensions over the Suez Canal It also created a negative atmosphere on money markets. Analysts say that this tension FED’s interest rate decision in March He predicted that it might cause it to be postponed until later.
ING analysts making a statement on the subject said, geopolitical risks, supply disruption and increase in energy prices It was emphasized that this situation may affect the FED’s interest rate cut date.
Increasing geopolitical risks in the Red Sea region raise concerns that supply disruptions and energy prices will lead to higher inflation. The next FOMC meeting on January 31 will be a difficult day for the Fed. We will probably see signals at that meeting that there will be no interest rate cut before March.
According to CME FedWatch data, the FED will meet on January 31. 97.4% probability of keeping the interest rate constant is displayed as.
Suez events create a rift in the global economy
supported by Iran Houthis in Yemenon the grounds of reaction to Israel’s attacks in Gaza On October 31, 2023 They tried to seize commercial ships off the coast of Yemen, which they said were affiliated with Israeli companies, and some of them. to carry out attacks with drones and missiles It had started.
USA on the grounds that global maritime trade security is in danger on December 18 against the Houthis with the participation of a group of countriesOperation Welfare Guardianmultinational named “maritime task force” announced that it was created. This decision raised the tension in the region to a higher level.
Trade through the Suez Canal accounts for approximately half of global trade. 12% It creates. According to ING analysts, these events shipowners increasingly longer and more expensive South Africa route pushed me to choose.