Fed Announces 25bps Rate Hike to 5%, Bitcoin Remains Flat
Crypto News

Fed Announces 25bps Rate Hike to 5%, Bitcoin Remains Flat

2m
1yr ago

The Fed confirmed what economists expect will be its final interest rate increase before a long-awaited pause. 

Fed Announces 25bps Rate Hike to 5%, Bitcoin Remains Flat

The Federal Reserve announced another small increase to its benchmark rate on Wednesday, bringing it between 5% and 5.25%. 

Bitcoin’s price remained relatively flat on the announcement, fluctuating between $28,000 and $28,500. 

  • The increase was largely in line with expectations, with the market only pricing in an 11.8% chance that the Federal Open Markets Committee (FOMC) would keep its rate flat, per the CME FedWatch tool
  • The central bank has been increasing its interest rate since last year in an effort to quell red-hot consumer price index inflation, which rose to a 40+ year high of 9.1% last June. 
  • Financial commentators like BitMEX co-founder Arthur Hayes predicted that the Fed might stop raising rates, and even begin lowering them far sooner than expected after multiple bank failures took place before the previous rate hike in May. 
  • Others such as Former Richmond Fed Chief Jeffrey Lacker assumed that the Fed would remain firm in hiking rates in the face of bank failures, rather than signal to markets that something is amiss. 
  • As of March 2023, inflation has been reduced to 5% – though some believe this may not last due to the Federal Reserve’s efforts to protect the banking system, which have already injected hundreds of billions of dollars back into the economy. 
  • “The U.S. banking system is sound and resilient,” stated the Fed in a press release accompanying its rate hike announcement. “Tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation.”

  • The central bank added that it would adjust its monetary policy stance “if risks emerge that could impede the attainment of the Committee’s goals.” 
0 people liked this article

Related Articles

Crypto News
XRP Legal Battle: The Frontline Fight Against the Chevron Doctrine’s Impact on Crypto
In a landmark legal showdown, Ripple Labs, the company behind XRP, is taking on the United States Securities and Exchange Commission (SEC) in a case that could have far-reaching consequences for th...
1yr ago
4m
Crypto News
NEAR Partners With Shemaroo For Indian Media Market
The NEAR Protocol has partnered with Shemaroo Entertainment to promote Web3 adoption in the Indian media and entertainment market.  NEAR x Shemaroo Comes To India Shemaroo Entertainment Limite...
1yr ago
3m
Crypto News
TON Foundation Partners With Chainalysis For Blockchain Security
The TON Foundation, dedicated to the advancement of The Open Network (TON), has partnered with Chainalysis to utilize its Crypto Incident Response Service, ensuring round-the-clock support for swif...
1yr ago
3m
Crypto News
PacWest Bank Drops 53% After Reports of Possible Sale Emerge
Shortly after it was reported that PacWest is “exploring strategic options”, the bank’s shares plummeted more than 50%. The post PacWest Bank Drops 53% After Reports of Possible Sale Emerge appeare...
1yr ago
5m
Crypto News
Bitcoin rally at crossroads as Fed preview looms, observers warn
Bitcoin (BTC), the world’s leading cryptocurrency by market value, has experienced a significant resurgence in 2022, with its price surging 70% since January 1st. However, some observers warn...
1yr ago
3m
Marketing
Who are the Bitcoin Billionaires?
Bitcoin Billionaires are growing under the trees every year, because they can be and you can't? Find out here
1yr ago
1m