Fed President Warns of Elevated Interest Rates Amid Iran Conflict

The recent escalation of tensions between the US and Iran has sparked concerns about the potential impact on global markets. In an interview, Boston Fed president Susan Collins highlighted the risks of energy shocks stemming from the conflict, which could keep interest rates elevated.

Collins emphasized that the Iran conflict-induced disruptions have the potential to triple inflation estimates compared to just 30 days ago. This has significant implications for the crypto market, with analysts predicting a possible 25-30% drop in Bitcoin prices if inflation continues to escalate.

The US Treasury's recent seizure of $500 million in crypto assets linked to Iran's Islamic Revolutionary Guard Corps is also contributing to a devaluation of Iran's currency. Despite these pressures, global markets have shown resilience so far, with strong corporate earnings and continued momentum in AI technology providing a floor under equities.