- The Federal Reserve has decided to maintain its key interest rate, causing further distress in the crypto market.
- Bitcoin and Ethereum have experienced a decrease in value, falling 4.6% and 1.3% respectively.
- Despite the daily downward trend, both Bitcoin and Ethereum have seen slight increases in the past hour.
Amidst the Federal Reserve’s decision to maintain its key interest rate, the crypto market experiences turbulence. Bitcoin and Ethereum see a decrease in value, yet show signs of slight recovery.
Federal Reserve Maintains Key Interest Rate
The Federal Reserve has elected to keep its key interest rate steady. This decision, part of the central bank’s ongoing efforts to combat inflation, has added to the existing turmoil in the crypto market. Federal Reserve Chairman, Jerome Powell, in his usual cautious tone, stated that the journey to achieving 2% inflation is challenging. He also mentioned that it is unlikely that the next policy rate move will be a hike.
Impact on Bitcoin and Ethereum
As a result of the Federal Reserve’s decision, Bitcoin and Ethereum have seen a decrease in their value. Bitcoin fell by 4.6% and Ethereum by 1.3%. However, despite the overall downward trend, both cryptocurrencies have shown slight increases in the past hour. This fluctuation in value is a direct result of the Federal Reserve’s decision and the overall state of the economy.
Inflation Concerns and Market Response
Signs of persistent inflation have caused traders to pause and reconsider their strategies. Last month, fears escalated that the Federal Reserve might be forced to keep interest rates higher for longer than anticipated. These concerns were heightened by a stronger-than-expected rise in inflation and growth in wages in the first quarter. The shifting rate expectations are influencing Bitcoin’s price more as spot Bitcoin ETFs see dwindling inflows.
Conclusion
The Federal Reserve’s decision to maintain its key interest rate has caused a ripple effect in the crypto market. The value of Bitcoin and Ethereum has decreased, but there are signs of slight recovery. Despite the current state of the market, traders and investors are keeping a close eye on the situation, ready to adapt their strategies as necessary.
