#The Fed injected nearly $7 billion in liquidity today

Today, the Fed injected approximately $6.8 billion in liquidity into the financial markets through repurchase agreements, marking the first such operation since 2020. This move is part of the year-end liquidity management strategy, with the Fed having injected a total of about $38 billion over the past ten days to stabilize the funding shortfall during the holiday season. The newly launched Reserve Management Plan (RMP) started this month, committing to purchase $40 billion in government bonds each month, which some describe as a "disguised quantitative easing" (QE). The cryptocurrency community has reacted enthusiastically to this, as historically, similar operations tend to drive the market up.

In terms of impact, in the short term, this move will enhance liquidity, potentially lower borrowing costs, and support the prices of assets such as stocks and cryptocurrencies. Bitcoin is expected to hit new highs as volatility decreases towards the end of the year, and analysts predict a bull market for the crypto market. However, in the long term, if seen as excessive money printing, it could reignite inflationary pressures, prompting future interest rate hikes. Safe-haven assets like gold may also benefit from the return of liquidity. Overall, this indicates the Fed's proactive stance in the post-pandemic economy, but continued injections may reshape the global financial landscape, benefiting risk assets while also exacerbating concerns about bubbles.