Hassan Maishera
TL;DR
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BTC surged to $87k on Wednesday after the Federal Reserve decided to leave interest rates unchanged.
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The Fed also reduced the growth outlook for the rest of the year while raising the inflation forecast.
Bitcoin Rallies to $87k on Fed Interest Rates News
The cryptocurrency market was bullish on Wednesday, with Bitcoin and other major altcoins currently in the green. Bitcoin surged by roughly 4% on Wednesday to hit a weekly high of $87,380 before retracing to now trade at $85,709 per coin.
The positive performance follows the Fed’s FOMC meeting results on Wednesday evening. As analysts expected, the Fed left its benchmark fed funds rate range steady at 4.25%- 4.50%, the second consecutive pause since three straight rate cuts to end 2024. The Fed is expected to cut interest rates twice before the end of the year.
However, the apex bank’s quarterly economic projections showed a sharp decline in expectations for economic growth. The Fed expects GDP increase in 2025 to hit 1.7% instead of the previous forecast of 2.1%. The growth outlooks for 2026 and 2027 were also reduced.
While speaking to Cryptowisser on the interest rates, Sergei Gorev, head of risk, YouHodler said,
“There are more and more signs in the markets that the Fed will gradually have to lower the interest rate in the medium term. The March correction of the S&P 500 index was the seventh fastest decline since 1929, during the Great Depression. The S&P 500 has fallen 10% since February, fully entering a technical correction. ETH has reached a five-year low against BTC. Thus, the situation on the stock markets is already hinting to the Fed leadership that it would be time to start lowering the rate at least in 2025, as it is becoming more and more difficult to grow further.”
With Bitcoin and other major altcoins performing positively, the total crypto market cap has now surpassed $2.8 trillion.
