The United States has been struggling with the highest inflation rate since the early 1980s, The U.S . Federal Reserve (Fed) says the increase in inflation has to do with the current crisis of Russia's invasion of Ukraine, and they also said that the crisis is causing economy and human hardship and suffering for the united states citizens, to try and reduce the increased inflation rate the U.S. Federal Reserve hiked interest rate by 0.5 percent. The increased interest rate was excepted to affect crypto negatively but the opposite is what we are seeing in the market and I like it.
Wondering what those who expected that the outcome of the Federal Reserve meeting (FOMC) was going to dump or crash the crypto or digital assets market, the crash was not only prayed for by crypto critics this time but by some crypto traders to hoping for the market to drop further so the can accumulate or buy more coins at a much cheaper rate. the prediction was majorly aimed at Bitcoin, their expectation was for Bitcoin to crash to the all time low of last year, Bitcoin dropped last year to $28k before it rallied back up.
But the FOMC meeting turned out to be in favour of crypto because the interest rate hike seems to have helped Bitcoin price rather than it making Bitcoin price fall, the uptick started by 6:00 UTC today and never stopped, so the supposed dump ended up being the catalyst for the current pump, so in my opinion, this increase of interest rate by 0.5 percent was a blessing to crypto because Bitcoin had been struggling for a while now and it needs a push which the increase interest rate has provided. in fact, not just the crypto market that is pumping at the release of the news but the stock market is pumping too because it has been correlating with Bitcoin since the pandemic. Hope this Bitcoin new found momentum lasts for long as the bear market has.
Fed hike in the interest rate and announced plans to reduce its balance sheet is supposed to make people cut back on spending and make stocks prices to fall, and due to the correlation between stocks and Bitcoin, people believed Bitcoin will fall too. But now both Bitcoin and stocks are pumping. The market is unpredictable.
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