The U.S. Federal Reserve (Fed) announced a 2-point interest rate cut today (19th). The market expected that the economy would enter a new round of easing policy cycle. However, under the hawkish tone of Fed Chairman Jerome Powell, Bitcoin subsequently U.S. stocks retreated after rising higher, and after a few hours of rest, they soared to $62,508 at around 9:00 this morning.
According to CoinGecko market data, as of press time, the top 20 cryptocurrencies are collectively rising. Bitcoin (BTC) is trading at $62,158, up 2.5% in the past 24 hours; Ethereum (ETH) is up 2.8%, trading at around $2,405. .
Before Ball held a press conference, the Federal Open Market Committee (FOMC) lowered the federal funds rate by 50 basis points (2 yards) to a target range of 4.75% to 5.00%, marking the first interest rate cut in the United States in more than four years.
The FOMC statement after the meeting emphasized that economic activities continue to expand at a solid pace, and also mentioned the risks to the labor market. It stated that it would be committed to the task of achieving full employment, taking into account the progress of inflation and the balance of risks, so it lowered interest rates by 2 percentage points, and also predicted that It is estimated that interest rates will be cut by another 2 percentage points by the end of this year, and by another 4 percentage points by the end of 2025.
Ball said at the post-meeting press conference that the 2-digit interest rate cut was a "recalibration" of the Fed's monetary policy. Therefore, there is no guarantee that this pace of interest rate cuts will be maintained at the next meeting, and the market should not assume that significant interest rate cuts will continue.
Bauer emphasized that the Fed is in no rush to loosen monetary policy because the U.S. economy is currently "in very good shape." He also pointed out that the Fed's policy direction does not have a preset route and will continue to be determined based on the economic situation at each future meeting. Make an interest rate decision.
What do analysts say?
Analysts at QCP Capital said that the Fed's interest rate cut will have a significant impact on the mid- to long-term prospects of the financial market, and short-term shocks are inevitable:
We are certain that market volatility will be high in the days following the meeting as traders reposition their positions in the coming weeks, and this policy shift may also mark the beginning of a strong overall economic trend. .
Despite the potential for volatility and price corrections in the short term, analysts advise investors to focus on longer-term opportunities, adding:
Although we expect that the market will see a certain degree of retracement, it will not hinder the long-term upward trend of Bitcoin. We favor long-term investment structures with unlimited upside potential to capture Bitcoin's possible parabolic rise.
Joel Kruger, market strategist at LMAX Group, also said: "The Fed's 2-digit interest rate cut meets market expectations. What we are concerned about now is whether the market can continue to be optimistic about the Fed's easing policy, because this easing policy has been fully digested. 」
BitMEX founder Arthur Hayes predicted that high-risk assets, including cryptocurrencies, may plummet within days after the Fed cuts interest rates. The reason is that the interest rate cut will narrow the interest rate gap between the United States and Japan, lead to a sharp appreciation of the yen, and trigger " The unwinding of yen carry trades.
Fed rate cuts are not necessarily good for Bitcoin! Arthur Hayes: May trigger a cryptocurrency crash
〈The Fed cuts interest rates by 2 yards in one fell swoop! Bitcoin soared above $62,000, and the cryptocurrency market rose collectively> This article was first published on "Blocker".
