The Federal Reserve Raises Interest Rates
The Federal Open Market Committee (FOMC) of the U.S. Federal Reserve has resumed its rate hikes after a temporary pause. The benchmark fed funds rate has been raised by 25 basis points to a targeted range of 5.25%-5.50%. This move was anticipated by market participants, who are now looking to Chairman Jerome Powell’s post-meeting press conference for further information on the central bank’s future plans.
Key Points:
- The Fed has resumed tightening monetary policy after a pause
- The price of bitcoin remained relatively unchanged after the announcement
- Tighter credit conditions are expected to impact economic activity, hiring, and inflation
- Market participants are eager to hear Powell’s comments on the central bank’s plans for future meetings
- While economists predict this may be the last hike this cycle, the Fed’s own projections suggest otherwise
Following a recent rally fueled by excitement over BlackRock’s Bitcoin ETF filing, the price of BTC has stalled due to the realization of the Fed’s rate hike. After reaching a high of $31,800, the crypto has dipped to a one-month low below $29,000.
Hot Take:
The Federal Reserve’s decision to raise interest rates again may have a significant impact on the economy and the cryptocurrency market. Market participants will have to closely monitor future meetings and statements from the central bank to gauge the direction of monetary policy. The divergence between economists’ predictions and the Fed’s own projections adds to the uncertainty surrounding future rate hikes. As a result, the price of bitcoin may continue to be affected in the coming months.
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