The critical interest rate decision of the Federal Reserve has been announced; Expectations were met! How did Bitcoin, the Dollar, and Gold react to the decision?
Fed’s Critical Interest Rate Decision Announced
The Federal Open Market Committee (FOMC) of the Federal Reserve has completed its two-day policy meeting and has resumed interest rate hikes after a meeting break, raising the target range to 5.25% – 5.50%.
BREAKING: #FED INCREASES INTEREST RATE BY 25 BASIS POINTS
— COINOTAG (@coinotag) July 26, 2023
Today’s move means the resumption of a tight monetary policy after a meeting break following a 15-month uninterrupted period of interest rate hikes that occurred in the Federal Reserve’s meeting six weeks ago. This increase, which was fully expected by the markets, showed an approximately 100% probability of such a move in the short-term interest rate markets based on the pricing of CME FedWatch, which is largely influenced by the actions of the Fed.
The following was stated in the Fed’s announcement:
“Tighter credit conditions for households and businesses could put pressure on economic activity, employment, and inflation. The extent of these effects remains uncertain. The Committee continues to pay extremely close attention to inflation risks.”
Market participants will closely follow Fed Chairman Jerome Powell’s press conference after the meeting in response to these statements. This meeting is held to seek clues about the central bank’s plans for the September meeting and subsequent meetings. Powell’s press conference will begin at 21:30 (18:30 UTC) Turkish time.
How Did Bitcoin, the Dollar, and Gold React?
The price of Bitcoin was trading at $26,268 before the decision was announced. It exhibited volatile movements when the decision was announced and has so far achieved a 0.58% increase to $29,437. Currently, the price of Bitcoin is trading at $29,290.
The Dollar Index (DXY) was at 101.288 before the interest rate decision was announced. It experienced a slight decrease after the decision and had a 0.15% decline to 101.137.
Gold, with the announcement of the decision, experienced a 0.15% increase to $1,973. Currently, Gold is trading at $1,969.
