Bitcoin Makes Surprise Climb As Fed Discloses 0.75 Point Rate Bump
29 July 2022 - 2:45AM
NEWSBTC
Bitcoin and the rest of the crypto market have been in a festive
mood in response to the U.S. Federal Reserve’s interest rate hike,
sending both Bitcoin and Ethereum climbing in prices. The
Fed’s announcement has sent Bitcoin’s price up by 5%. As of this
writing, Bitcoin is trading at $22,837, up 7 percent in the last 24
hours. More so, Ethereum’s price also spiked by 11.6%; hitting
$1,550, data from Coingecko show, Thursday. In fact, the entire
crypto market is on a positive outlook with the total crypto market
cap at $1 trillion. Bitcoin was down the past week with its price
plunging below $21,000. But, with Fed’s latest 0.75% rate bump, the
BTC price has skyrocketed once again. Fed Battling Inflation With
Interest Rate Hikes The Federal Reserve attempts to buffer
inflation with a 0.75% rate increase. The central bank’s move on
the rate hike is said to be in the country’s best interest
especially since the U.S. Bureau of Labor Statistics recently broke
it to the public that the Consumer Price Index or inflation rate is
at 9.1% in June, a 40-year high. The Fed’s continuing rate hikes
have sent the negative message that the country could be in danger
of a recession. It triggered a domino effect. Following the Fed’s
rate hike, the U.S. interest rates have also spiked at a range of
2.25% and 2.5% which is at extreme levels since the COVID-19
pandemic started. The U.S. central bank has recently revealed this
development at the Federal Open Market Committee held Wednesday.
Related Reading | BNB Basks In The Green As Price Glows 5.84%
In Fields Of Red Survey: 96% Of Americans Worried About Inflation
The Fed has been trying to put a rein on the high prices with an
increase in interest rates for the longest time. U.S. Bureau of
Labor Statistics disclosed that the biggest factors adding up to
the inflation rate are shelter, gasoline, and food price hikes.
Reportedly, a CNBC poll revealed that around 96% of Americans have
been particularly worried or concerned lately regarding the gas,
shelter, and food price increase. Image: Beinchain To
beat inflation, the Fed has the option to constrict the supply of
money. So, it resorts to bumping the interest rates which in
effect, makes loans expensive. The 0.75% rate hike was expected
although it was earlier ruminated that the central bank may go for
a 1% rate hike when inflation mellowed in June. Related Reading |
GNOX Set To Overtake APE, MATIC As Token’s Price Continues Ascent
The recurring high prices and interest rate hikes have fueled fear
in citizens as the danger of a recession continues to escalate. It
has heightened levels of uncertainty in global markets especially
because a recession would most likely happen following two straight
quarterly GDP drops. The GDP as presented by the Bureau of Economic
Analysis has shown that the economy has dwindled by 1.6% as shown
in the first financial quarter and economists are concerned that a
decline is possible too for the second quarter. GDP Q2 numbers will
be announced tomorrow. And the White House has already prepared the
public for this important announcement with an interview transcript
and blog post by Janet Yellen, the Treasury Secretary who has set
the records straight that two consecutive quarters is not
indicative of a recession. More so, U.S. President Biden made an
assurance of sorts that the country is not going to face a
recession. Crypto total market cap at $1.02 trillion on the daily
chart | Source: TradingView.com Featured image from Euronews, chart
from TradingView.com
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