đ¨Bitcoin on fire: The Fed announces a drastic drop in rates to come
â In the changing world of finance, a recent event has lit sparks in the Bitcoin universe: the American Federal Reserve announces a significant reduction in its interest rates by 2024. But then, how did this news come about? Did she set fire to the crypto market? Letâs embark together on this financial adventure, where numbers dance and cryptocurrencies soar!
đ¨The Fed announces, bitcoin responds
â While the crypto sphere is fervently focusing on the possible acceptance of a Bitcoin ETF, other ingredients are coming into the mix, thickening the plot of this financial saga. Between anticipations of the next bitcoin halving and the recent turmoil on global markets, the announcement from the American Federal Reserve adds spice.
â The Fed maintained its rate range, oscillating between 5.25% and 5.50%. However, it created a surprise by revising its forecasts for the end of 2024. Rates would go from 5.1% to 4.6%.
â This drop of 75 basis points represents a real twist in the monetary universe. It suggests a future where access to credit would be more affordable. However, the consequences of this decision extend far beyond this simple reduction.
â In the wake of this announcement, bitcoin saw its price rise modestly, but significantly. The signal is clear: investors see bitcoin as a safe haven, a haven of peace in a disrupted financial world.
â Lower interest rates reduce the cost of money, which can have mixed effects on investments. On the one hand, it makes borrowing more affordable, potentially boosting spending and investment.
â On the other hand, this can make savings investments and certain financial assets, such as bonds, less attractive due to lower returns.
