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The cryptocurrency market is abuzz in anticipation of the Federal Reserve’s decision and comments from Fed Chairman Jerome Powell later this week.
The US Federal Reserve’s final meeting of the year is scheduled for this week; The Federal Open Market Committee meeting on Tuesday and Wednesday is of particular interest to investors eagerly awaiting the final decision on this year’s interest rates.
Other economic statistics will be released throughout the week, including November retail sales on Tuesday, weekly initial jobless claims and third-quarter GDP growth rate on Thursday.
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On Monday, markets were pricing in a 97% chance of a 25 basis point interest rate cut. Markets will look to the Fed’s updated policy statement and Chairman Jerome Powell’s news conference on Wednesday for clues on future interest rate decisions.
The Fed is currently in a blackout period, meaning committee members cannot make public comments until after the FOMC meeting.
What to expect?
If the Fed announces a rate cut and Powell’s comments are viewed positively, the cryptocurrency market could react positively. Lower interest rates typically boost risky assets, including cryptocurrencies, as investors seek higher returns.
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On the other hand, if Powell’s statement suggests a slowdown approach or if the rate cut is smaller than expected, the market could react unfavorably. Concerns about persistent inflation and a slower pace of rate cuts could dampen investor enthusiasm.
During Monday’s trading session, the crypto market is currently showing mixed price action. Bitcoin recently reached a new all-time high.
According to CoinMarketCap, the price of Bitcoin recently rose 1.41% daily to $103,926, after hitting a new record high of $106,554 in early trading on Monday. Ethereum rose 1.62% in the last 24 hours to $3,951. The majority of cryptocurrency assets are trading in the red; XRP, Shiba Inu, Toncoin and BONK lost between 2% and 4%, while SUI, BGB, Fantom and RUNE gained between 4% and 15% in the last 24 hours.
The results of the Fed’s decisions and Powell’s ideas could set the tone for the market in the coming days.
