third consecutive<\/a> 75 basis point interest rate increase on Wednesday.<\/p>\nRisk assets dropped sharply lower after the interest rate decision. The S&P 500 and Nasdaq closed 1.7% and 1.8% lower, respectively, on Wednesday. At the time of writing, U.S. stock futures traded in the red.<\/p>\n
The central bank reiterated its commitment to fighting the price rise. It said, \u201cInflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures.\u201d<\/p>\n
Six of the 19 members of the Federal Open Market Committee <\/strong>(FOMC) projected interest rates will peak between 4.75% and 5% in 2023, while 12 see them rising\u00a04.5% to 4.75% or higher in the coming year.<\/p>\nOANDA senior market analyst Edward Moya <\/strong>said the market has bid \u201cgoodbye\u201d to a soft landing.\u00a0<\/p>\n\u201cThe Fed delivered a third straight 75bp rate hike and signaled they expect the Federal funds rate to rise to 4.6% this cycle. The updated staff projections were a bit more hawkish than many expected.\u201d<\/p>\n
However, taking stock of Powell\u2019s comments that FOMC is split between 100 and 125 bps rate hikes for the rest of the year, Moya said, \u201cPeak tightening is almost here and that should be good news for risky assets.\u201d<\/p>\n
On the apex coin\u2019s reaction, he said, \u201cBitcoin found support at the $18,800 level as Wall Street gains confidence they have a handle on how high the Fed will take rates.\u201d<\/p>\n
\u201cRaising rates is negative for crypto because it means that it becomes more expensive to borrow because loan payments are larger and so it entices people to save more, which is what central banks want to clamp down on persistently high inflation,\u201d said GlobalBlock<\/strong> analyst Marcus Sotiriou<\/strong>, in a note seen by Benzinga.\u00a0<\/p>\nCryptocurrency trader Micha\u00ebl van de Poppe<\/strong> said the period between now and 2023 is \u201cthe period to accumulate\u201d and said it was difficult to predict \u201cmoon or doom\u201d for Bitcoin.<\/p>\n