Will Bitcoin price correct before a major FOMC decision?
Cryptocurrency 2 hours ago (March 18, 2023 02:12AM ET)
Will Bitcoin price correct before a major FOMC decision? © Reuters Will bitcoin price correct before a major FOMC decision?
BTC/USD +1.69% BTC/USD +1.97% The Federal Open Market Committee of the US Federal Reserve (FOMC) is scheduled to meet next week from March 21-22, 2023. While the central bank will have to address the issue of containing inflation ; He will also have to factor in the banking crisis. at an annual rate of 6%; which is the consumer price index in the United States ; The Fed is still far from hitting its 2% target. The central bank will also study measures to protect investors in the event of an exacerbation of the bank's crisis in the coming weeks. due to the interest rate hike over the past 12 months; The banking sector took a hit as its investments in municipal bonds, treasuries and securities became less profitable. at the same time ; The crypto market is showing no signs of FUD from the banking meltdown as the price of Bitcoin has skyrocketed over the past week. However, previous instances of a rate correction ahead of Fed meetings may be repeated ahead of next week's decision. There is no possibility of volatility although market sentiment has changed with the dynamics of the banking crisis ; However, a 25 basis point rate hike could be bullish for the cryptocurrency ecosystem as it goes against the Fed chair's recent comment about accelerating rate hikes. Jerome Powell spoke in the context of stronger economic data and the possibility of higher inflation. This could also mean that bank stocks continue to trade in the red ; Hence the rise in cryptocurrency prices. However, analysts also predict that the Fed may choose to halt the increase this time around; Although the target prospect may change before the meeting. Currently, the CME FedWatch tool, which measures the likelihood of a Fed rate target ; 38% chance of not raising prices and 63% of 25 basis points at the next meeting. With the increasing dynamics in the macro environment and the banking sector ; Bitcoin price could see sideways movement or a small correction in the run-up to the meeting.
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