Bitcoin rallied above $61,000 following the United States Federal Reserve’s decision to cut interest rates by 50 basis points. The Fed’s decision to cut rates for the first time since 2020 is a move long predicted by crypto traders, and most anticipate Bitcoin and the wider cryptocurrency market to benefit from the policy reversal.
Data from Cointelegraph Markets Pro and TradingView followed Bitcoin’s (BTC) price action as it reacted to the rate cut decision even as the market awaited accompanying commentary from Fed Chair Jerome Powell.
BTC/USD 15-minute chart. Source: TradingView
The Federal Open Market Committee (FOMC) opted to take an aggressive step by cutting interest rates by half a point, the first since the early days of the COVID-19 pandemic in 2020, in an effort to head off a slowdown in the labor market.
“The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run,” a press release stated.
Market participants highly anticipated the move, and according to data from CME Group’s FedWatch Tool, the bulk of investors believed a 0.25% to 0.50% rate cut was 100% probable.
The following is a comparison of FOMC’s statement on Sept. 18 with the one issued after the Fed’s previous policymaking meeting in July (text in red) when the rates were left unchanged.
Comparison of July and Sept. 18 FOMC statement. Source: CNBC
At the time of writing, Bitcoin price is trading at $60,400, and traders will closely disssect Powell’s post-FOMC presser comments to make estimates on when additional rate cuts could be implemented.
Related: Why Bitcoin price is stuck
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.