Bitcoin surged to 40000 after the US Federal Reserves decision
Software

Bitcoin surged to $40,000 after the US Federal Reserve’s decision to hike interest rates

Bitcoin price surged 6% in one fell swoop and even surpassed $40,000 the moment after the US Federal Reserve System meeting. The reason for this was the decision by the regulator to raise the key interest rate by 50 basis points or 0.5%, writes CNBC.

    Source: Coindesk

Source: Coindesk

The US rate hike has not been this sharp in about 20 years – traditionally the incremental hike is 25 basis points. Against the background of this decision, at the moment the cost of the cryptocurrency rose to $40,000 per token, but when the news was written, the price corrected to $39.7,000.The price of bitcoin traditionally correlates with the movement of the bitcoin stock market. Along with it, the Nasdaq index rose more than 3% and the S&P 500 rose 2.9%.

Nick Mancini, head of behavioral research for cryptocurrencies at Trade the Chain, said that apart from a 0.75% rate hike, any decision by the Fed would have a positive impact on the value of stocks and cryptocurrencies. “We believe the market has factored in a possible 0.25-0.5% rate hike. This decision gave confidence to the markets, which led to growth.”

Experts say this won’t be the Fed’s last rate hike. Bloomberg consensus forecast says the rate will rise another 0.5% in June. Then the regulator will throttle the pace to 25 basis points. By December the estimated rate will be 2.25-2.5%.

RELATED TOPICS

About the author

Robbie Elmers

Robbie Elmers is a staff writer for Tech News Space, covering software, applications and services.

Add Comment

Click here to post a comment