Ethereum Price Movers: ETH Supply Rise, FOMC Minutes and Fed Rate Cut

Ethereum price sluggish and mundane movement can be attributed to a dramatic decrease network gas fees, according to the latest report by Kaiko.

Ethereum price has suffered a dismal fate since the approval of ETFs in July. While investors had anticipated a drastic rally to an all-time high, broader market sentiment flipped bearish, dragging Ether down with it.

The uncertainty still shrouds crypto assets, with investors now looking forward to the possibility of the Fed lowering interest rates by at least 25 basis points.

Ethereum Price Sluggishness Linked To Rising ETH Supply

The sluggish and mundane movement in Ethereum price can be attributed to a dramatic decrease in network gas fees, highlighted in the latest report by Kaiko.

The reduction in gas fees to a five-year low was propelled by soaring layer 2 protocol activity and the Dencun upgrade in March.

While low transaction fees favor network users, it has far-reaching implications on ETH as an asset. Lower gas fees result in less ETH being burned, which increases the token’s supply in the long run.

As per Kaiko’s data debrief, “ETH’s total supply has risen consistently since April,” disregarding new developments like the approval of spot ETFs.

Increasing supply could dampen potential ETH price momentum in the short term, especially considering the high demand for the asset.

Macroeconomic Factors To Impact Ethereum Price Prediction In 2024

Macroeconomic factors will continue to impact Ethereu price prediction in 2024, considering the sell-off and the struggle to recoup losses incurred in the last two weeks.

The FOMC meeting minutes on August 24 will offer clues regarding the policy outlook and the vote on the Fed interest rates cut in September.

The Federal Reserve Chair Jerome Powell is expected in Wyoming at the Jackson Hole Symposium on August 21.

This is an annual event organized by the Kansa City Fed, bringing together experts and academics to discuss key economic policy.

Jerome’s speech is the most vital and will focus on the US economic outlook amid recession fears and calls for rate cuts.

ETH Price Analysis: ETH Sends Mixed Signals

Ethereum price holds above $2,600 support while moving sideways between $2,500 and $2,800 range limits.

All factors considered, downside risks may continue to engulf ETH, which may extend the down leg to $2,400 to collect more liquidity.

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