The crypto market is once again in turmoil due to the recent banking crisis, causing significant volatility. Despite this, experts remain optimistic about the asset class. However, with the upcoming Federal Open Market Committee (FOMC) meeting, investors are understandably concerned about the impact of interest rates on their investments.
FOMC Meeting: What To Expect?
Altcoin Daily has analyzed the possibility of a mild recession and the impact of the upcoming Fed meeting. The video shared by the channel reveals that the Fed meeting today and tomorrow will be crucial and play a pivotal role, as there is a 90% chance of a 25 basis point hike which may go up by the end of the month by a 5- 5.25% hike.
Crucial points to consider:
- Inflation remains high and instead of coming down, it’s once again in the red zone. Despite this, the rate hike is expected to go ahead.
- The US economy and labor market are slowing down due to low growth, which could have a significant impact on microeconomic factors.
- Post Silicon Valley Banks collapse and the Struggle of First Republic, the market is once again volatile, and quantitative tightening to ease inflation or avert a recession looks negative for GDP growth, causing investors to back out.
Decision Time for Investors
It’s decision time for the FOMC meeting, where the Fed Chairman announces whether the interest rate will rise, stay put, or fall. The market hangs on his every word as though he were a sage of ancient times.
Jerome Powell has had his fair share of criticism for getting inflation completely wrong when it first took off and then making the most violent and abrupt interest rate rises in history. However, the market still has to pay heed because this man and his agency are still playing the role of God for the markets. Another 25 basis point interest rate rise is firmly on the cards for tomorrow, although given the dire straits of some of the banks, this raise is still not cast in stone.
Related: Elizabeth Warren Slams Jerome Powell at Congressional Hearing – Coinpedia Fintech News
Impact on the crypto market
Unfortunately, the news isn’t positive for the crypto market, as a rate hike is likely to have a negative impact. Bitcoin is currently facing strong resistance at $30,000, and a potential drop to $25,000 could also affect altcoins.
The Fed will announce its latest policy decision today at 2 p.m., with Fed Chair Jay Powell set to hold a press conference at 2:30 p.m.
As an investor, it’s essential to keep a close eye on these developments and adjust your investment strategy accordingly. It’s important to remain calm, informed, and prepared for any eventuality.