Bitcoin recovered $ 98,000 for the first time in almost three months after the American federal reserve said that it would maintain interest rates in the same way for another month.
The Fed’s decision to maintain unchanged interest rates comes despite the growing pressure from US President Donald Trump, who threatened barely weeks ago to dismiss the president of the Fed, Jerome Powell, for being “too late” in the reduction rates.
Fed cites higher unemployment, the risk of inflation
Powell said on May 7 that the Federal Reserve rate adjustment committee held rates of 4.25% to 4.50% due to higher increase in higher and higher inflation risks.
He added that inflation “dropped a lot but ran above our 2% longer lens”. Powell said that household and businesses have shown a “strong decrease in feeling” mainly due to the concerns about Trump’s trade policy.
However, Powell said that “despite increased uncertainty, the economy is still in a solid position”. In the days preceding the announcement, data from the Fedwatch tool of the CME group indicated that the long -term market expected minimum chances of a rate drop.
Powell said the unemployment rate remains low and that the labor market is “or almost maximum employment”. The market expects the Fed to lower the rate of federal funds to 3.6% by the end of 2025.
Bitcoin (BTC) fell below $ 97,000 at $ 95,866 after Powell’s speech, but climbed to type $ 98,000 for the first time since February 21 a few hours later.
Bitcoin Momentum has been built, with the Crypto Fear & Greed Returning index on the territory of “greed”, and locate negotiated Bitcoin (ETF) funds displaying entries of almost $ 4.41 billion since March 26.
In relation: The price of bitcoin joined 1,550% the last time that the metric “BTC risk-off” fell to this low
On March 9, the network economist, Timothy Peterson, warned that if the Fed is held on the rate drops in 2025, this could lead to a wider slowdown in the market, potentially bringing Bitcoin to $ 70,000.
Peterson’s forecasts occurred after Powell said in March that “we don’t need to be in a hurry and that we are well placed to wait for greater clarity”.
Review: Adam Back says that the Bitcoin price cycle is “10x larger”, “empathy” for ETF buyers
This article does not contain investment advice or recommendations. Each investment and negotiation movement involves risks and readers should conduct their own research when they make a decision.
