Bitcoin Price Rebounds as Fed Chair Warsh Explains Rate-Hike Pause
The US Federal Reserve kept interest rates unchanged after September's first hike in over three years, with two policymakers dissenting.
In what was the most anticipated decision, the US Federal Reserve maintained interest rates unchanged following September's first rate hike in over three years. However, the decision wasn't unanimous, as two of the 12 policymakers voted to raise the benchmark to 4%-4.25%.
After last month's hike, all eyes turned to September's inflation data from both CPI and PPI indices, which showed inflation remains a significant concern. Despite this, expectations for an immediate rate hike diminished, with experts suggesting any increase would likely come in December.
Fed's Rationale
The Federal Reserve justified its decision by pointing to stronger-than-expected economic activity. They noted that job gains have kept pace with workforce growth while the unemployment rate remained stable.
Job gains have kept pace with the workforce, and the unemployment rate has changed little.
In the subsequent press conference, Fed Chair Kevin Warsh emphasized that financial uncertainty and elevated inflation persist due to "geopolitical developments." He affirmed the economy's resilience while stressing the committee's commitment to "deliver price stability."
Bitcoin's Response
Despite on-chain signals suggesting potential price decline, Bitcoin demonstrated volatility but ultimately rebounded. The cryptocurrency fluctuated between $79,500 and $81,700 ahead of the Fed meeting, dipping to $80,500 shortly before the decision.
Following Chairman Warsh's press conference, Bitcoin swiftly climbed back above $81,000. However, other major macroeconomic developments through the end of the week could drive further price fluctuations in the cryptocurrency market.
Related
