Republican Kevin Hern disclosed that the debt ceiling deal could likely be reached by Friday afternoon, potentially causing massive volatility in the financial markets. Traders were hoping for positive indications from the negotiations on Thursday, but there hasn’t been significant progress since top Republican Kevin McCarthy‘s Monday meeting with US President Joe Biden. Coinciding with these negotiations, the Personal Consumption Expenditures (PCE) Price Index, which measures consumer goods and services purchasing rates, is scheduled for release on Friday.
While traders pay close attention to inflation data, many are keen to see where the debt ceiling negotiations go before the looming June 1st deadline. US Treasury Secretary Janet Yellen warned of potential government default in early June 2023 if no agreement is reached. She also predicted a massive 45% drop in stock prices if negotiators fail to reach a deal.
In a scenario where no debt ceiling deal is reached on Friday, shorters could become dominant players, while the crypto market could experience a surge in prices. However, reports indicate that progress has been made in Biden’s recent meetings with Congressional leaders. Both sides must now agree on limiting spending to $70 billion. In light of this, a deal seems more likely than not, which could lead to an uptick in stock prices due to positive developments.
On the other hand, Bitcoin price has seen a decline over the last 30 days, following a decrease in speculation surrounding the regional banking crisis. Binance added to the market landscape by introducing support for Polkadot-based USDT stablecoin.
The potential end of PoW support for Ethereum has also caught the market’s attention, with ETH prices jumping as a result. As the debt ceiling negotiations continue, traders will need to keep an eye on these developments, along with inflation data and the progress made in the governmental discussions. Only time will tell if the anticipated deal is reached or if the markets face a new wave of volatility.
The content presented here may incorporate some authors’ personal opinions, and the market conditions must be continuously observed. Conduct thorough research before investing in cryptocurrencies, as neither the author nor the publication can be held responsible for any personal financial loss.
Source: Coingape
