Prominent Chinese crypto journalist and blogger Colin Wu, who often shares an insider perspective on the cryptocurrency space on X/Twitter, has reminded the community that later this week the scheduled FOMC meeting will take place.
During this event, the U.S. Fed Reserve will make a fundamental announcement that is likely to impact the future movement of the Bitcoin price.
Interest rate decision coming
According to the tweet published by the aforementioned insider, during a FOMC meeting scheduled for March 20, Wednesday, U.S. Federal Reserve chairman Jerome Powell will announce the Fed’s decision on the interest rate.
However, data published by the CME platform hints that the Fed is likely to leave the interest rate unchanged; the probability of this decision is high at 99%.
The Federal Reserve FOMC will announce its interest rate decision on March 20 this week, and Chairman Powell will give a speech. Currently, CME shows that the probability of keeping interest rates unchanged is as high as 99%. In addition, Switzerland, Australia, the United…
— Wu Blockchain (@WuBlockchain) March 18, 2024
Here’s the catch with the coming announcement
The Fed’s interest rate has a major impact on financial markets, including that of crypto assets, and in anticipation of the first rate announcement this year, the cryptocurrency community’s concerns about future Bitcoin price behavior are rising.
Over the past few years, the Federal Reserve has been tightening rates in an attempt to tame growing inflation. However last year, Jerome Powell started hinting that perhaps it is time to begin loosening interest rates. As the date of this announcement drew closer, the Bitcoin price kept rising in the anticipation of the approaching Bitcoin halving, on the high daily BTC purchase rate set up by ETFs and in anticipation of the Fed beginning to cut rates this year.
Traditionally, rate tightening by the Fed impacts the prices of risky assets, including Bitcoin, negatively, and rate loss allows for an inflow of funds into BTC, propelling the price higher.
Bitcoin recovers over weekend
Last week, the world’s flagship cryptocurrency, Bitcoin, reached another new all-time high for the month, this time, hitting $73,750. However, after reaching such a high number, BTC suddenly reversed to show a 12% correction and hit $64,908 on Sunday.
By now, the BTC price has staged a 5% recovery, but it was followed by another 1.31% step down. Bitcoin can now be traded at $67,926 at the time of this writing.
