Monetary Policy

Gate News message, April 21 — Barr, the nominee for U.S. Federal Reserve chairman, stated that specific figures for the balance sheet size have not yet been determined.

Gate News message, April 21 — During a Senate hearing on April 22, U.S. Senator Cynthia Lummis asked Federal Reserve chair nominee Wosh whether digital assets should be integrated into the nation's financial system to provide Americans with new investment opportunities and consumer protections. Wos

Federal Reserve Chair nominee Kevin Warsh pledged at a confirmation hearing that, if confirmed, he would sell undisclosed assets in accordance with an agreement with the Office of Ethics to address potential conflicts of interest. He emphasized the priority of rising living costs and the need for fundamental reform, including a new inflation framework and improved communications, and noted that the Federal Reserve’s economic forecasts have a time horizon that is too long and that it is still working through legacy errors. Warsh also said he has agreed to sell the relevant assets, and if confirmed, he would liquidate any remaining undisclosed holdings.

Gate News message, April 21 — U.S. President Donald Trump stated that "the United States should always maintain the lowest global interest rates." Trump noted that interest rate adjustments have played a role in addressing inflation concerns.

Trump reiterates support for rate hikes to curb inflation, claiming the policy has effectively restrained price pressures.

Summary: BoJ is likely to hold at 0.75% on April 28 while signaling future rate hikes if conditions permit; June action remains possible, with some officials leaning toward a near-term move amid inflation risks from geopolitical shocks and a higher forecast. Abstract: The Bank of Japan is expected to keep its policy rate at 0.75% at the April 28 meeting, signaling eventual hikes as conditions permit; discussion centers on timing and a potential June move, in light of geopolitical tensions and an updated inflation outlook.

International Settlements Bank (BIS) Managing Director Pablo Hernández de Cos warned on Monday at a Bank of Japan conference in Japan that the global stablecoin market has surpassed $315.9 billion, but its operating mechanism is closer to investment products such as ETFs rather than true money. The BIS said that if large-scale redemptions occur, it would trigger a chain-reaction effect similar to the run on Silicon Valley Bank in 2023.

South Korea's central bank Governor Shin Hyun-song aims to promote CBDCs and deposit tokens through Project Hangang Phase 2, emphasizing digital payment innovation and financial stability while signaling a softening stance on stablecoins.

Kevin Warsh, nominated by Trump, becomes the first “Tech Bro” Fed chair, closely connected with Silicon Valley giants, and argues that AI can reduce inflation and supports an accommodative monetary policy. His Silicon Valley background could influence the Fed’s interest-rate decisions; expectations for the crypto market are positive, but the risk of conflicts of interest also needs to be considered. His appointment process and future policy direction will affect the U.S. Dollar Index and valuations of Taiwan stocks.

The Bank for International Settlements (BIS) once again emphasized the importance of global stablecoin regulatory coordination, pointing out three major risks that stablecoins face at this stage, including regulatory challenges related to cross-border flows and issues with market concentration. BIS proposed a unified ledger framework and argued that central banks need to lead the development of digital currencies, which would pose challenges to existing stablecoin issuers such as Tether and Circle. Overall, in the future, stablecoins may face a more stringent regulatory framework.

From 17:45 to 18:00 (UTC) on 2026-04-19, the ETH price recorded a return of -0.56% within 15 minutes, closing in the 2294.03 - 2311.0 USDT range, with an amplitude of 0.73%. Heightened market volatility triggered increased short-term trading activity and boosted attention, while overall liquidity performance tightened. The main driving force behind this unusual move is institutions’ short-term in-and-out flows of ETF funds and a lull in on-chain stablecoin activity. In early April, after the ETH spot ETF recorded a net inflow of $120.24 million over a short period, it quickly reversed to a net outflow of $64.61 million, indicating that institutional capital became more short-term and there was no signal of sustained accumulation. Meanwhile, on-chain USDT and USDC activity fell in tandem to an annual low; ETH’s short-term buying power was clearly insufficient, putting pressure on liquidity. In addition, high-win-rate whales have been frequently shorting ETH and BTC since April 14, with related position sizes exceeding $25 million, further intensifying downward pressure in the short term. On the macro front, the Federal Reserve maintains high interest rates, the U.S. dollar remains strong, risk appetite has shifted to cautious, and some funds have flowed into traditional assets such as U.S. stocks. On-chain data shows that exchange reserves for ETH have fallen to the lowest level in nearly a decade, suggesting that long-term holders are actively shifting away from self-custody, further reducing market liquidity supply and amplifying price anomalies. Network conditions are stable; gas fees are operating at low levels, and on-chain transactions have not shown extreme spikes. The risk of near-term fluctuations remains high. ETF fund flows, large on-chain transfers, stablecoin activity, and changes in whale positions will be key indicators to watch. If institutions step up selling or stablecoin outflows expand further, ETH price volatility may intensify. Please continue to monitor macro developments and on-chain liquidity changes, stay alert to the risk of sharp short-term volatility, and get more real-time updates.

UBS analysts predict the Federal Reserve will cut interest rates by 50 basis points by 2026, despite rising energy prices. Fed Chairman Powell suggests limited tightening is needed, focusing on core inflation evidence before cuts. The forecast for Treasury yields indicates potential downward movement.

The Federal Reserve is highly likely to keep interest rates steady in April, with a 99.5% probability. Looking ahead to June, there's a 94.1% chance of maintaining rates, a 0.5% chance of an increase, and a 5.4% chance of a cut.

Gate News message, April 17 — The rate swap market is signaling a dovish shift, with current pricing reflecting expectations for 15 basis points of Federal Reserve rate cuts by December.

On April 17, Hong Kong interbank offered rates (HIBOR) increased across all tenors, with the one-month rate rising to 2.55143% and overnight rates hitting the highest level since January at 3.36536%.

Bank of Japan Governor Kazuo Ueda highlighted the conflict in the Middle East as a source of inflation and economic slowdown risks. He confirmed that the Monetary Policy Committee will determine suitable measures to reach the 2% inflation target at the upcoming meeting.

The CME's Fed Watch tool indicates a 99.5% probability of the Federal Reserve keeping rates unchanged in April, with similar projections for June showing a 98% likelihood of steady rates and minimal chances for rate cuts or hikes.

Federal Reserve Governor Michelle Bowman indicated that, given current conditions, the central bank might reduce interest rates only three times for the rest of the year.

Federal Reserve official John Williams affirmed a steady monetary policy outlook, projecting 2% to 2.5% economic growth and stable unemployment around 4.25% to 4.5%. Inflation is expected to decrease from 2.75% to 3% in 2026 to 2% in 2027.

Bank of England Governor Andrew Bailey said at an IIF event that the effective functioning of stablecoins depends on users’ confidence in full redemption mechanisms, calling for the development of international standards. The United States has meanwhile released the GENIUS Act, requiring stablecoin issuers to meet compliance requirements. In South Korea, Circle’s CEO said there are no plans to launch a won-pegged stablecoin, and that the company is currently watching local legislative debates.