Fed signals that printing is coming

The US Federal Reserve is fully prepared to step in and stabilize financial markets if needed, according to Susan Collins, President of the Boston Fed. While current conditions appear stable and there's no broad concern over liquidity, Collins stressed that the Fed has a range of tools ready to respond to any potential market disruptions.

She made it clear that while interest rate cuts are not the primary method for addressing liquidity issues, other established tools could be deployed quickly if market functioning breaks down. This approach echoes the Fed's swift action during the 2020 pandemic, when it used emergency measures to maintain market stability.

Amid recent market volatility and fears of inflation due to new trade tariffs, investors have raised concerns about reduced liquidity in the $29 trillion Treasury market. Despite large price swings, analysts say that market behavior remains orderly for now, and any Fed intervention would depend on how conditions evolve.
The Federal Reserve's readiness to act could have notable effects on the crypto market. If the Fed steps in to stabilize traditional markets, risk sentiment may improve, leading investors to move back into riskier assets like cryptocurrencies.