© Reuters. After Fed’s 75 Basis Point Hike, Bitcoin, Cardano Turn Volatile
- The federal funds rate is now turned from the 3.75% to 4% range.
- After the hike, , ADA, , and turned volatile again.
- Bitcoin saw a low of $20,210 at 18:00 UTC followed by a sharp jump to $20,751.
U.S. Federal Reserve officials have hiked the benchmark interest rate by 75 basis points for the fourth time now and it has turned Bitcoin (BTC), (ADA), Ripple’s XRP, and Shiba Inu (SHIB) volatile again. The federal funds rate is now turned from the 3.75% to 4% range.
Thus, within a day, Bitcoin sank to a low of $20,210 at 18:00 UTC on 02 November to jump sharply later at a new intraday high of $20,751. Additionally, altcoins including Cardano (ADA), XRP, and Shiba Inu (SHIB), among others are somewhat imitating Bitcoin’s volatility.According to the Federal Reserve press release:
Effective November 3, 2022, the Federal Open Market Committee directs the Desk to: Undertake open market operations as necessary to maintain the federal funds rate in a target range of 3-3/4 to 4%
Investors speculate that the Federal Reserve will further increase the benchmark rate by 50 basis points in December. However, strong employment numbers believe that the central bank will announce the fifth consecutive 75-basis point hike in a row. Fed Funds futures state that traders see a 98.4% chance of a December hike.
A possible reason for the shoot-up in crypto and stocks after the announcement can also be traced to the Federal Open Market Committee (FOMC) statement which hinted at “possibly smaller increments.”Furthermore, the Committee will also be ready to adjust the ‘stance of monetary policy’ as appropriate in case more risks emerge, including its readings on public health, labor market conditions, inflation expectations and pressures, and financial and international developments.
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