The Federal Reserve unanimously raised interest rates by a quarter point to 3.75%-4%, its first hike since July 2023, and its updated projections point to at least one more increase this year. Bitcoin and ether swung sharply after the decision before easing lower, and bitcoin's rough week continued on a stalled crypto bill in the Senate.
Fed raises rates unanimously, Warsh turns to inflation
The Federal Reserve's Open Market Committee voted 12-0 to raise its target range for the federal funds rate to 3.75%-4%, a quarter-point hike and the central bank's first increase since July 2023. Chair Kevin Warsh struck a hawkish tone in his opening remarks, saying financial conditions are not particularly tight.
According to The Block: "I would be hard-pressed to describe broad financial conditions as restrictive," Warsh said, adding that the view was widely shared by the committee. AMBCrypto reported that the labor market's strength has let the Fed put its focus back on inflation, which remains above its 2% target.
Sixteen of 18 policymakers project at least one additional quarter-point hike this year, the Fed's updated projections showed.
Bitcoin and ether swing, then ease
Bitcoin traded between roughly $75,000 and $76,500 immediately after the decision, before settling near $75,600. Ether swung between about $2,370 and $2,430 before easing to around $2,376.
Bitcoin was down about 0.2% over the following 24 hours while ether stayed almost unchanged, AMBCrypto reported. XRP dropped more than 2% even as the broader crypto market, excluding stablecoins, rose 0.8% to about $2.29 trillion over the same period.
A rough week for bitcoin continues
Even before the rate decision, bitcoin had fallen roughly 4% over the past week after failing to hold an advance toward $80,000. The slide followed the U.S. Senate's failure to advance the Digital Asset Market CLARITY Act, which fell short of the 60 votes needed to move forward.
Traders are now watching resistance near $78,600 and a liquidation cluster around $74,600 as the next levels that could shape bitcoin's direction.
Sources: The Block, AMBCrypto, crypto.news
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