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On September 19th, gold prices continued their upward trend during the U.S. trading session. Although investors believe that the Federal Reserves stance on future policy was less dovish than expected, gold prices have still risen by nearly 10% this month, supported by expectations of U.S. interest rate cuts, safe-haven demand, and gold purchases by central banks around the world. Barbara Lambrecht of Commerzbank stated, "We believe that the current upward momentum in gold has paused, although data next week may show that Asian gold buyers are gradually adjusting to the current high price level. However, given that we expect the Federal Reserve to cut interest rates more than the market expects next year, we believe that gold prices will continue to rise in the long term."The UN Security Council failed to pass a resolution to permanently lift UN sanctions on Iran.On September 19th, European natural gas prices continued to fluctuate in a narrow range as traders weighed two factors: the EUs new round of sanctions against Russia and a gas supply disruption in Norway. In afternoon trading, the Dutch TTF natural gas futures contract, Europes benchmark natural gas contract, fell 1.5% to €32.47 per megawatt-hour. ANZ Bank noted, "Russia currently still meets over 10% of the EUs natural gas import needs, with approximately half of this supply coming in the form of liquefied natural gas (LNG). Given that the global LNG market is expected to enter a surplus later this decade (after 2025), any sanctions will likely have an impact on natural gas prices in the short term." Investors are also closely watching unplanned outages at gas fields in Norway, Europes largest single supplier of natural gas.French Ambassador to the United Nations: So far, we have not received a sufficiently good response from Iran on the issue of the quick restoration of sanctions. We must continue with the quick restoration procedure on September 28.Hezbollah leader Naim Qassem called on Saudi Arabia to open a new chapter and engage in dialogue with Hezbollah.

NY Fed’s Williams Says Digital Currency Might Impact Monetary Policy

Jimmy Khan

Jun 02, 2022 18:06

Only a few top Federal Reserve officials have spoken out about cryptocurrencies and their potential to destabilize monetary policy. A central bank digital currency (CBDC) may coexist with stablecoins and give a level of safety, according to Vice-Chair Lael Brainard.


Governor Miki Bowman of the Federal Reserve Board of Governors also emphasized the need of innovation in community banking, citing the Fed's recent discussion paper on cryptocurrency.

When it comes to crypto legislation or a CBDC, the United States is still in the early stages of investigation.


The President of the New York Fed called digital transformation "essential."


The president of the Federal Reserve Bank of New York, John Williams, views digital revolution in payments as a method to influence the Fed's monetary policy and balance sheet.


Williams noted that although technology is fast evolving, the mission of the central bank remains the same in his remarks at a Columbia University research conference on Wednesday. "The job of central banks will always be to provide money and liquidity to promote economic and financial system stability," he said.


CBDCs and stablecoins backed by secure and liquid assets, he told an audience of financial sector professionals, central bank officials, and academics, offer opportunity for innovation.


His comments come amid broader crypto sell-offs, with cryptos such as bitcoin (BTC) battling to break over the $30k barrier. After plunging from an all-time high of approximately $67,000 in November 2021, the world's first cryptocurrency is currently trading below $30,000.


Terra's network failure, which sent terra (LUNA) and TerraUSD (UST) values to new lows, has prompted Fed officials like Williams to investigate secure currency digitalization.


According to a Reuters story, Williams said that digital transformation might have "implications for markets" and "how we carry out monetary policy," as well as the Fed's dealings with peers. "It's vital that we understand how these shifts might influence the economy and financial system, as well as the execution of monetary policy," he said.

Senators Contribute to the Fight for a Digital Currency

A digital dollar or CBDC might have a host of advantages, but it's still a long way off.


The recent volatility in cryptocurrency prices has prompted US politicians to draft legislation that would empower the US Treasury to form a CBDC. According to the plan, the digital dollar would essentially eliminate payments transfer waiting times while also lowering expenses.


The Biden administration issued an executive order in March asking for additional study into the development of a digital currency and highlighting the need for stronger governmental monitoring of cryptos like ether (ETH), Litecoin (LTC), and others.


Crypto advocates also argue that financial inclusion is critical for the United States to accept its digital currency.


Several senators, though, are in favor of introducing a digital currency into the payments system. "As digital payment and currency technologies continue to expand rapidly, and with Russia, China, and over 90 countries worldwide already researching and launching some form of Central Bank Digital Currency," Rep. Stephen Lynch (D-Massachusetts) said, "it is absolutely critical for the United States to remain a world leader in the development and regulation of digital currency and other digital assets."

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