U.S. Federal Reserve Bank Chair Jerome Powell announces that interest rates will remain unchanged during a news conference at the Federal Reserves’ William McChesney Martin building on June 12, 2024 in Washington, DC.
US Fed Meeting Outcome LIVE Updates: On Wednesday, the US Federal Reserve declared its decision regarding the interest rate. Following the two-day FOMC meeting, the benchmark interest rate of 5.25–5.50% stayed unchanged. For the seventh time in a row, nothing has changed at this meeting. In line with Wall Street forecasts.
This choice will have a huge impact on the Bitcoin market. The launch of the world’s first cryptocurrency was viewed with skepticism and speculation as market investors were expecting more rate cuts.
The Fed makes no changes to its monetary policy!
According to the Fed’s predictions, the single rate decrease will be a quarter point before the end of the year. Reducing the three cutbacks scheduled for March. This announcement had an immediate impact on Bitcoin as investors adjusted their strategy to reflect monetary policy. This has a coordinate affect on both advertise liquidity and capital costs.
Bitcoin is as often as possible respected as a support against expansion or a secure sanctuary asset. It reacts delicately to adjustments in Fed policy. The US dollar strengthens when a restrictive monetary policy is followed, as it is at the moment! This can result in a drop in the price of Bitcoin. However, a rate cut can make the dollar less valuable. As a result, investors may find Bitcoin more attractive.
Bitcoin’s Short- and Long-Term Viewpoint
The Federal Reserve’s statement comes after a period of moderate volatility in Bitcoin. This indicates that traders had already priced in some of the news. Bitcoin options expiring soon suggest that the cryptocurrency may not rise above 3% following this ruling. This suggests that, while the Fed’s decision is critical, the Bitcoin market may not see significant short-term volatility.
Moreover, this regulation has complicated the long-term implications for bitcoin. Recessions historically precede Fed rate cuts, causing investors to move their money out of riskier investments like bitcoin. A delayed rate cut by the Fed this year could signal sluggish economic growth. This could prompt investors to turn to bitcoin as a means of preserving their wealth.
The Fed’s decision to maintain its stable monetary policy, with only one rate cut expected, will have a direct and indirect impact on the Bitcoin market. When monetary policy and economic conditions change, investors should be cautious and be prepared to revise their holdings.
