Bitcoin Rally Falters Despite Uptick on Fed Holding Rates Steady
- The decision lines up with the Feds measured approach to the aim and the 2% inflation stability.
- The Bitcoin price was not able to sustain the momentum and took a sharp turn.
U.S. Federal Reserve officials have decided to maintain the current range of 5.25% to 5.50% for the benchmark federal funds rate. This decision and the updated predictions that follow it indicate that there will be very little rate decreases in the near future.
Inflation has fallen somewhat, but Federal Reserve Chairman Jerome Powell has said that interest rates will stay there for the time being to keep the economy stable. That lines up with the Feds measured approach to the aim and the 2% inflation stability.
One Rate Cut Anticipated This Year
There has been an attempt to reduce inflation, but Powell said in the meeting that it has been relatively modest compared to earlier claims of a halt. The Federal Reserve reversed its previous predictions of numerous cuts and now anticipates one 25 basis point drop by the end of 2024 in its latest estimates.
Further easing is anticipated in 2025, with cuts of up to 100 basis points forecast, in light of the speedier pace towards the targeted inflation rates.
The most recent Consumer Price Index (CPI) data, which was issued before the meeting, showed that inflation was slowing down, which helped the Fed change its forecast. The Consumer Price Index (CPI) showed a year-over-year rise of 3.3% in May, down from 3.4% in April, suggesting that price increases may have stabilised.
As a result of these rate cut announcements, the price of Bitcoin went as high as $70,000. However, the price was not able to sustain the momentum and took a sharp turn. At the time of writing, Bitcoin is trading at $67,540 as per data from CMC.
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Text source: TheNewsCrypto – Blockchain & Cryptocurrency News M
