Surprisingly, Bitcoin (BTC) is on the rise—at least for the moment.
In a significant move, the United States Federal Reserve has increased the key interest rates by 25 basis points for the first time in three years.
With a unanimous vote of 12-0, the Federal Open Market Committee has decided to adjust the target range for the federal funds rate to between 3.75% and 4%. This step aligns with their dual mandate objectives.
This adjustment was largely anticipated following recent events, including the robust US jobs report released a couple of weeks ago and the assertive comments made by Fed Chair Kevin Warsh. In addition, last week’s inflation figures provided further justification for the Fed’s decision.
The market’s reaction to the news was unexpected, as Bitcoin soared by $1,500, reaching a temporary price of $76,500 before stabilizing.
Just yesterday, the cryptocurrency experienced a notable decline following the Senate’s setback regarding the CLARITY Act, but today’s increase indicates that the Fed’s hike had already been accounted for in market valuations. All attention now shifts to Warsh’s upcoming remarks.