Reserve

Chair

Wednesday

Crypto Market News: The Federal Open Market Committee (FOMC) announced on Wednesday that it would keep interest rates unchanged for the fourth time, being in line with market expectations. This comes on the back of the <a href="https://coingape.com/glossary/consumer-price-index-cpi/" target="_blank" rel="noopener">Consumer Price Index (CPI)</a> rising 0.3% month over month in December 2023. Initially, Bitcoin prices post the news were rangebound but inched down later. 
<h2 id="us-fed-keeps-rates-unchanged-says-inflation-remains-elevated">US Fed keeps rates unchanged, says inflation remains elevated</h2> 
The Federal Open Market Committee <a rel="nofollow" href="https://www.federalreserve.gov/monetarypolicy/files/monetary20240131a1.pdf" target="_blank">decided</a> to maintain the target range for the federal funds rate at 5.25%–5.5 on Wednesday. It voted unanimously to maintain the interest rate paid on reserve balances at 5.4 percent, effective February 1, 2024. The market had priced in a near 96% chance of the Fed keeping the rates steady <a rel="nofollow" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html?redirect=%2Ftrading%2Finterest-rates%2Fcountdown-to-fomc.html" target="_blank">according</a> to the CME FedWatch Tool. 
However, the Federal Reserve also noted that recent indicators suggest that economic activity has been expanding at a solid pace. Job gains have moderated since early last year but remain strong, and the unemployment rate has remained low. The key point in the Fed’s report was that inflation has eased over the past year but remains elevated. 
In previous meetings, the Fed had hinted that if inflation drops to the target of 2% followed by a slowing economic expansion, it would start lowering interest rates. The current expectations stand at three rate cuts in 2024. Additionally, traders are now paying close attention to Fed Chair Jerome Powell’s speech. It will be streamed live on Fed’s official YouTube <a rel="nofollow" href="https://www.youtube.com/@federalreserve" target="_blank">channel</a>. 
Zakhil Suresh, a crypto asset manager and CEO of BitSave in an interview with CoinGape said, “the economic situation has not improved to a level where we can see aggressive rate cuts”. 
At FOMC’s last sessions in December and November of 2023, the Fed had continued to keep interest rates unchanged. This had given some respite to the troubled banking industry and sluggish stock market. 
The Federal Reserve had aggressively started hiking rates back in March 2022. Since then, the FOMC has raised the benchmark interest rate eleven times. The hikes saw interest rates stand at their highest level in 22 years—a targeted range of 5.25%–5.5%. 
<h2 id="what-will-crypto-markets-focus-on">What will crypto markets focus on?</h2> 
Apart from the rate decision, markets across the globe will <a href="https://coingape.com/fomc-meeting-2024-date-what-to-expect-and-its-impact-on-crypto-market/#:~:text=The%20global%20stock%20and%20crypto,75%2D100%20bps%20in%202024." target="_blank" rel="noopener">keep an eye</a> on Fed Chair Jerome Powell’s press conference. Markets will now focus on how quickly the Fed will start a cycle of rate cuts. Powell’s speech is expected to provide cues to the market on monetary policy and rate-cut plans for the year. 
Even a slight signal of future rate cuts by the Fed can help boost risk appetite amongst investors, resulting in more trading volumes in the crypto market. 
However, Zakhil Suresh says ” he does not expect the rate cuts to happen immediately”. He adds that even when the rate cuts happen, it might take a few months before having a significant impact on high-risk speculative assets like crypto. 
The&nbsp;<a href="https://coingape.com/price/bitcoin/" target="_blank" rel="noopener">Bitcoin price</a> maintained sideways momentum in its initial reaction to the rate decision. After being a little range-bound, BTC prices inched lower. At the time of writing, the OG cryptocurrency fell to $43,124.09, down nearly 0.8% in the last 24 hours. The market cap for BTC also toppled 0.5% to $847.5 billion. However, trading volumes for the last 24 hours have ascended 6.6% for Bitcoin. 
&nbsp; 
&nbsp; 
The post <a href="https://coingape.com/breaking-us-fed-keeps-interest-rates-unchanged-after-two-day-meeting/">Breaking: US Fed Keeps Interest Rates Unchanged; Bitcoin Price Inches Down</a> appeared first on <a href="https://coingape.com">CoinGape</a>.

Breaking: US Fed Keeps Interest Rates Unchanged; Bitcoin Price Inches Down

Table of Contents

Coingape News Media

Other articles published on Jan 31, 2024

Menggali Potensi Pasar Kripto: Retik Finance, Solana dan Polygon

USDT leads the way as stablecoin inflows cross $400M

21Shares & Ark Invest Spot Bitcoin ETF Rakes in Whopping $600M

Altcoins Flying Under the Radar: 3 Cryptos to Watch for Potential Gains in February

Buying Frenzy: SUI Rounding Bottom Sparks Excitement

Crypto Gem Deestream (DST) Ignites Wave Of Presale Investors From Ethereum (ETH) & Avalanche (AVA...

Join our free newsletter for daily crypto updates!