Crypto markets were focused on the Fed’s interest rate decision today. Fed In line with the general expectation, the funding rate is 0-0.25 kept in range. But he laid the groundwork for a rate hike, saying “it would be appropriate soon”. Here are the details.
Leading cryptocurrency following the announcement of the interest rate decision of bitcoin The price spiked up to $38,825 as an intraday high.
In general, the Fed In march start of the first rate hike and this year in total 4 times Interest rates are expected to increase. Saying that a rate hike “may soon be appropriate”, the Fed signaled that a rate hike could come in March, as many economists and investors expected. However, it should be noted that there is no concrete timeline for now.
The Federal Open Market Committee (FOMC) said in a statement after the meeting that it will continue to reduce its purchases of bonds and “Beginning of March” He said he would end it. The FOMC also noted the impact of the Omicron variant of COVID-19 on the economic recovery. Fed“The sectors most adversely affected by the pandemic have recovered in recent months, but are affected by the recent sharp increase in COVID-19 cases,” he said.
Fed Chairman speaking after the meeting Jerome Powell “We carefully monitor whether the economy is developing in line with expectations. We expect inflation to fall within the year.” used the phrases. The following words stood out:
- “Inflation continues to be above our long-term target, it is impossible to predict the policy rate path.”
- “We have yet to decide on the timing and pace of downsizing, we have good room to raise interest rates.”
- “We are ready to use our tools so that high inflation does not take root.”
- “Take steps from meeting to meeting on the balance sheet issue.caz. We will also provide more information on downsizing the balance sheet.”
- “Inflation is above our target, the things that cause high inflation are related to the virus, the increase in cases due to the Omicron variant will suppress economic activity this quarter.”
- “We will make a decision on the interest rate at the March meeting.”
- “We respond if inflation slows, and we respond if inflation is higher than expected.”
- “After we’ve settled on interest rates, we’ll turn to balance sheet reduction.”
- “You asked me about the risks. Risks: There is a risk of inflation being even higher. The pandemic may continue to evolve. It can reduce growth. There may be problems on the Supply Chain side.”
- “We will work to achieve our long-term 2% inflation target.”