BIS: Fiscal consolidation will eventually reduce the need to maintain high interest rates

The Bank for International Settlements (BIS) issued a warning to indebted countries on Sunday, stating that market confidence could suddenly be lost, confirming long-standing concerns about the cryptocurrency market. According to some cryptocurrency experts, both Bitcoin and gold are signaling a financial crisis for the United States and other developed countries. This year, so-called zero-yield assets have risen 48% and 13%, respectively, reportedly due to safe-haven demand. Although cryptocurrency supporters believe that BTC is the opposite of fiat currency, this type of cryptocurrency often falls along with other risky assets during times of pressure. The consensus in the cryptocurrency market is that debt concerns will force the Federal Reserve and other central banks to cut interest rates, thereby stimulating more investors to flow into alternative assets such as Bitcoin. The FedWatch tool at the Chicago Mercantile Exchange shows that traders expect the Federal Reserve to cut interest rates twice this year, each time by 25 basis points. The Bank for International Settlements also added that fiscal consolidation will ultimately reduce the need to maintain high interest rates. "For fiscal policy, fiscal consolidation is an absolute priority. In the short term, this will help alleviate inflationary pressures, reduce the need to maintain high interest rates, and help maintain financial stability."