Bitcoin was higher for a second day, staying in a range of between roughly $15,200 and $15,600, as news of progress in developing a coronavirus vaccine appeared to touch off a rally in U.S. stocks.
With the outcome of last week’s U.S. presidential election now mostly settled, crypto analysts turned to other market factors, such as whether investors and bitcoin (BTC, +0.26%) miners might take advantage of the recent price increase to pocket gains.
“The week ahead is not as easy to call,” Matt Blom, head of sales and trading at the cryptocurrency-focused financial firm Diginex, wrote in a note to clients. “The initial thoughts lead me to believe we will consolidate, with support levels being tested throughout the early part of the week. Profit taking could feature.”
In traditional markets, reports of a successful vaccine pushed up U.S. stock futures. Gold changed hands at $1,915 an ounce, down 1.9% for the biggest drop in a month.
The U.S. election is over. Whew.
What remains is the coronavirus pandemic is far from over, nations are saddled with debt, foregone revenue is driving up corporate bankruptcies and some 10 million fewer Americans are employed than at the start of the year. A divided U.S. Congress at a time when President Donald Trump is still challenging the outcome of the election could stall passage of a new fiscal stimulus bill – anywhere from $750 billion to $1.5 trillion. Federal Reserve Chair Jerome Powell said last week that such a package is still badly needed to help the economy heal.
With those downers as the backdrop, CoinDesk’s Omkar Godbole has dug into the important question of whether the introduction of a digital dollar might spur higher inflation that’s been largely absent even after the Fed pumped expanded its balance sheet this year from $4 trillion to more than $7 trillion.
It’s an academic question of sorts; the Fed is conducting research on a digital dollar but doesn’t appear in any rush to launch one.
But Cleveland Federal Reserve President Loretta Mester suggested earlier this year that a digital dollar might represent a way for the U.S. central bank to distribute aid directly to Americans – rather than having to wait for Congress to authorize more fiscal stimulus or relying on banks and Wall Street to pass along any monetary stimulus to households and small businesses.
Jeff Gundlach, chief executive of the $141 billion bond fund DoubleLine Capital, noted recently in a report that…
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