FED hikes interest rates by 75 base points
7/27/2022, 06:16 PM
The Federal Reserve's decision to raise interest rates by another 75 basis points has sparked concerns that the country may be headed for a recession. The Fed's repeated rate hikes are in response to data indicating that inflation in the U.S. has reached a 9.1% rate, a 40-year high.
The most recent rate hike puts interest rates back at pre-pandemic levels, and the Fed is hopeful that this will help to curb inflation rates. However, many Americans are concerned about the impact of these rising prices on their everyday lives. According to a recent CNBC poll, 96% of citizens are “concerned” about the food, gas, and shelter price rises.
To fight inflation, the Fed can attempt to contract the money supply by raising interest rates and making borrowing money more costly. The 75 basis points hike was widely expected, though it was speculated that the central bank could opt for a 100 basis points hike shortly after the inflation data for June dropped.
The Fed's efforts to curb inflation come as uncertainty prevails across global markets and fears of a possible recession escalate. The Bureau of Economic Analysis' GDP print showed the U.S. economy shrank by 1.6% in the first financial quarter, and many economists fear that the economy could post a decline in the second quarter - which would technically qualify as a recession according to historical standards (two consecutive quarters of GDP decline).
The White House has seemingly been preparing the public for a negative GDP announcement tomorrow, with Treasury Secretary Janet Yellen arguing that two consecutive quarters would not indicate that the country was in a recession because the Bureau of Economic Analysis looks at “a broad range of data." President Biden echoed this sentiment in an interview on Monday, saying that he did not believe the U.S. was heading for a recession.
While it remains to be seen whether or not tomorrow's GDP print will confirm fears of an impending recession, there is no doubt that America is facing economic challenges on multiple fronts at present. The most recent rate hike by the Federal Reserve could have a negative impact on the bitcoin price. If the Fed's efforts to curb inflation lead to a recession, that could cause investors to lose confidence in the economy and turn to bitcoin as a safe haven asset. If the Fed's rate hikes continue to push the economy towards a recession, that could lead to a further decline in the bitcoin price.
The Federal Reserve's decision to raise interest rates may have a negative impact on the price of bitcoin. Higher interest rates make borrowing money more expensive, and this could lead to less investment in bitcoin. Additionally, the Fed's efforts to fight inflation could lead to a recession, which could also negatively impact the price of bitcoin.
The most recent rate hike puts interest rates back at pre-pandemic levels, and the Fed is hopeful that this will help to curb inflation rates. However, many Americans are concerned about the impact of these rising prices on their everyday lives. According to a recent CNBC poll, 96% of citizens are “concerned” about the food, gas, and shelter price rises.
To fight inflation, the Fed can attempt to contract the money supply by raising interest rates and making borrowing money more costly. The 75 basis points hike was widely expected, though it was speculated that the central bank could opt for a 100 basis points hike shortly after the inflation data for June dropped.
The Fed's efforts to curb inflation come as uncertainty prevails across global markets and fears of a possible recession escalate. The Bureau of Economic Analysis' GDP print showed the U.S. economy shrank by 1.6% in the first financial quarter, and many economists fear that the economy could post a decline in the second quarter - which would technically qualify as a recession according to historical standards (two consecutive quarters of GDP decline).The White House has seemingly been preparing the public for a negative GDP announcement tomorrow, with Treasury Secretary Janet Yellen arguing that two consecutive quarters would not indicate that the country was in a recession because the Bureau of Economic Analysis looks at “a broad range of data." President Biden echoed this sentiment in an interview on Monday, saying that he did not believe the U.S. was heading for a recession.
While it remains to be seen whether or not tomorrow's GDP print will confirm fears of an impending recession, there is no doubt that America is facing economic challenges on multiple fronts at present. The most recent rate hike by the Federal Reserve could have a negative impact on the bitcoin price. If the Fed's efforts to curb inflation lead to a recession, that could cause investors to lose confidence in the economy and turn to bitcoin as a safe haven asset. If the Fed's rate hikes continue to push the economy towards a recession, that could lead to a further decline in the bitcoin price.
The Federal Reserve's decision to raise interest rates may have a negative impact on the price of bitcoin. Higher interest rates make borrowing money more expensive, and this could lead to less investment in bitcoin. Additionally, the Fed's efforts to fight inflation could lead to a recession, which could also negatively impact the price of bitcoin.