Today we’ll look at an important topic, namely, how the Fed works 👨💻
For a general understanding, the Fed is the US Central Bank, which influences the market by lowering or raising interest rates.
The Federal Reserve is located in the United States and prints dollars. The main task of the US Central Bank is to grow the US economy and, accordingly, control the level of inflation
By lowering interest rates, they provide people with cheap exports and affordable credit, which increases economic activity. This stimulates the economy and financial markets, but leads to inflation.
When interest rates rise, this, on the contrary, cools the economic situation. Central banks raise rates when inflation is high and GDP growth is very low.
All this is done to balance the dollar and the global economy.
Thus, if inflation is high, the Fed should change its priority from inflation to the economy, which will indicate further market movement.
It is important to understand that BTC 💰 traded against the dollar💵 , so the Fed has a special influence on it
