The United States is a target for the international markets. During today's FOMC meeting, the Federal Reserve will announce the interest rate increase. The robust U.S. The latest hawkish rate hikes by the Fed and the dollar have prolonged the bear market and put tremendous pressure on the stock and cryptocurrency markets worldwide.
Wall Street analysts predict that the Fed will likely raise rates by another 75 basis points, but that doesn't matter right now. In fact, given the gradual rise in recession fears, Fed Chair Jerome Powell's speech is even more significant now.
Scenarios of a 50 or 75 Bps Rate Increase by the U.S. Federal Reserve
The probability of a 75 bps rate hike is 90.2%, whereas the probability of a 50 bps rate hike is only 9.8%, according to the CME FedWatch Tool. It suggests that the Fed will probably proceed with another rate increase of 75 basis points to combat inflation.
According to well-known cryptocurrency expert Michael van de Poppe, a rate hike of 75 basis points won't be the key factor influencing markets in the coming weeks. In fact, price movement in the cryptocurrency market will be influenced by Federal Reserve Chair Jerome Powell's speech outlining his aggressive or dovish future perspective.
Investment bank JPMorgan claims that a rate increase of 50 basis points by the Fed might lead to a 10% increase in the value of American stocks. Goldman Sachs anticipates a rate increase of 75 basis points in November and a 50 basis point increase in December. Additionally, the Fed will maintain its dovish attitude while raising interest rates in 2023.
Before the Fed decides whether to raise interest rates, the cryptocurrency market is still erratic. The U.S. Dollar Index (DXY), which has been rising over the past few days, is currently volatile. Indicator DXY is at 111.30.
The European Central Bank similarly increased interest rates by 75 basis points last week. Additionally, the U.S. GDP for the third quarter came in higher than predicted at 2.6%. After registering negative GDP growth for the previous two quarters, this is the biggest GDP growth since Q4 of 2021.
Crypto Analysts Continue to Be Positive
Michael van de Poppe, Will Clemente, Scott Melker, and other cryptocurrency analysts are still optimistic about Bitcoin and the leading altcoins. However, when the Federal Reserve raised interest rates, the price of bitcoin may fall below $20k and begin a rally around $22.4K.
The price of bitcoin increased to over $20k and has held above that threshold ever since. Additionally, a rise in the liquidation of short positions suggests the bear market may be nearing its end. The current exchange rates for Bitcoin (BTC) and Ethereum (ETH) are $20,400 and $1,552, respectively.
In the midst of whale accumulating, other cryptocurrencies including XRP, DOGE, SHIB, Cardano (ADA), and BNB shown upward price momentum.
