Bitcoin hits new all-time high amid Fed’s 25bps rate cut
The US Federal Reserve announced a 25 basis point (bps) interest rate cut, a bullish sign, while Bitcoin broke through an all-time high. Fed Chairman Jerome Powell has said directly that election results will not affect future rate cuts.
These reductions are lower than last September's round. However, they are still considered bullies for Bitcoin and the broader crypto market.
Bitcoin and Powell rate reduction system
On Thursday, the US Federal Reserve announced a new rate cut of 25 basis points (bps). This translates into a target range of between 4.5% and 4.75% and is in line with what Fed Chairman Jerome Powell has said is a gradual tapering plan in the coming months. The previous price cuts in September proved a high pay signal for the crypto industry.
Read more: Bitcoin (BTC) Price Prediction 2024/2025/2030
Bitcoin prices have already hit highs since Donald Trump won the election, but this new price drop could add to the sentiment. In fact, on Thursday, Bitcoin made another new all-time high at $76,800. However, as of writing, Bitcoin has pulled back slightly and is currently trading at $75,800.
When the news first hit the crypto scene, analysts across the board reacted with absolute excitement. CryptoRover, the founder of the CryptoSea analysis platform, has previously said that bearish trends alone could take Bitcoin to $100,000.
Even the bearish forecasts are based on the assumption that the reduction will be too conservative. In September, analysts warned that perceived market volatility could hurt risky assets like Bitcoin.
Darkex Global, a liquidity provider and asset exchange, has theorized that a Trump victory could dampen future price cuts or create instability. Fed Chairman Jerome Powell said this.
“The election will have no impact on our policy decisions. The economy is very difficult to predict in the near term. We don't guess, we don't guess, we don't guess,” Powell said.
Read more: How to protect yourself from inflation using cryptocurrency
In other words, nothing in the current political climate has convinced the Fed that it should slow or stop rate cuts. Powell emphasized his long-term goal of reducing U.S. inflation and boosting employment. If this current gradual easing trend is working to satisfy the Fed, Trump's election will not derail it.
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