Bitcoin saw more volatility on Wednesday after the Federal Open Market Committee meeting, where the US Federal Reserve agreed to raise its benchmark interest rate by 0.5%.
The announcement, which was in line with market expectations, signaled the Fed’s first move this year to slow the hawkish pace of monetary policy.
- When the Federal Reserve announced its decision at 2:00 PM EST, Bitcoin immediately fell from $18,300 to $17,850 within five minutes.
- The asset reversed course shortly after and was trading at $17,960 at the time of writing.
- According to information from Queen GlassCryptocurrency market action contributed to $44 million in liquidations over the past 24 hours, most of which came from bitcoin trades.
- The largest single liquidation was an ETH-BUSD transaction on Binance for $1.04 million
- Going into the meeting, the market was pricing in roughly an 80% chance of a 50-point increase, with a 20% chance of a fifth 75-point increase, according to CME. FedWatch tool. With the sound of the previous bell, the central bank’s target rate is between 4.25% and 4.5%.
- The Fed has raised interest rates throughout 2022 in an effort to combat record high CPI inflation. With inflation figures for November showing signs that their efforts are working, market participants expect increases to slow into 2023.
- Many other central banks appear to be raising interest rates. Bank of Canada more dangerous It raised 50 basis points again in October, with the Bank of England next in September.
- The United Nations has pressure The Federal Reserve will reverse course on raising interest rates for months, citing risks of a possible global recession. In fact, many cryptocurrency industry companies have already had to adopt it Mass layoffs This year, mostly in response to macroeconomic problems.
The post that Bitcoin fell below $18K after the Federal Reserve announced a 50 basis point exchange rate hike first appeared on CryptoPotato.