Announcement on the Fed's interest rate policy in May
The Federal Reserve (Fed) concluded its two-day meeting in May, deciding to keep interest rates at 4.25% to 4.50%. According to the minutes from the meeting published on Wednesday, policymakers continue to assess the impact of President Donald Trump's tariffs, particularly the threat of rising prices.
The impact of interest rates on the cryptocurrency market
The Fed controls borrowing costs in the United States, using interest rates as a tool to adjust the pace of economic growth. When interest rates rise, personal and business spending decreases, helping to cool inflation.
When interest rates drop, borrowing costs become cheaper, encouraging businesses to expand operations and hire more. Currently, despite the slowdown in the labor market, the Fed remains determined not to change its policy. Analysts predict that inflation remains the Fed's main target. Therefore, Wall Street investors do not expect the Fed to cut interest rates in June and predict an 80% probability of keeping rates unchanged through July.
Potential impact on the cryptocurrency market
The Fed's interest rate policy directly affects the value of cryptocurrencies. When interest rates remain low, investors often seek profits in high-risk assets like cryptocurrencies, contributing to the growth momentum of this market.
Conversely, any signs of rising interest rates could diminish the appeal of the cryptocurrency market, causing the values of coins like Bitcoin and Ethereum to fluctuate more sharply. The Fed's maintenance of low interest rates for an extended period could stimulate an increase in cash flow into the cryptocurrency market, helping blockchain projects develop faster.
Overview of interest rate trends in 2023
In the context of the global economy still facing many uncertainties, predictions about the Fed's interest rate policies remain a key factor. Investors should pay attention to the latest developments to make appropriate strategic decisions, especially in the cryptocurrency sector.
Further reference: Europe is courting Southeast Asia, but cannot yet compete with China or the United States
Source: https://tintucbitcoin.com/cuc-du-tru-lien-bang-giu-lai-suat-anh-huong-thi-truong-tien-dien-tu/
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