bitcoin (BTC) experienced high volatility on March 22 when the US Federal Reserve hinted that it might halt interest rate hikes.
Powell on rates: "'May' and 'some' instead of 'ongoing'"
Data of Cointelegraph Pro Markets and TradingView It showed sharp moves both up and down for BTC/USD as the Federal Reserve rallied an anticipated 25 basis points.
during a course Press conferenceFed Chairman Jerome Powell appeared to downplay the ongoing US banking crisis and its aftermath, while hinting that today's rate hike could be the last.
Powell said in prepared remarks that the Fed believes "events in the banking system in the past two weeks are likely to result in tighter credit conditions for households and businesses, which in turn would affect economic outcomes."
"It is too early to determine the extent of these effects and therefore too early to say how monetary policy should respond," he said.
"As a result, we no longer state that we anticipate that ongoing rate increases will be appropriate to quell inflation. Instead, we now anticipate that additional policy tightening may be appropriate."
BTC/USD initially saw local lows of $27,867 on Bitstamp around the events before trading back above $28,000, only to continue falling as of this writing as markets continued to digest Powell's responses to press inquiries.
Specifically on rate hikes, he said the terms "may" and "some" rather than "ongoing" would be better to describe future policy.
Markets view the Fed's decision as slightly dovish as the forward-looking statement makes a pause in May more likely. The Fed now says that "some additional policy reassurance may be appropriate." This is a downgrade of the previous statement. The dollar falls, gold, Bitcoin, stocks rise, the yield curve steepens. pic.twitter.com/5jpIbunveI
โHolger Zschaepitz (@Schuldensuehner) March 22, 2023
In reaction, some commentators, however, described Powell's Fed as "hard-liners" in putting inflation ahead of the banking crisis by continuing to rise.
"The Fed has shown so far that it is committed to higher rates for longer + inflation as enemy number 1," Tedtalksmacro wrote partly from Twitter following.
BTC price comes full circle
Therefore, Bitcoin did not deliver the trip to $30,000 that some expected in the run-up to the rate hike decision.
Related: Will the Fed stop rate hikes? 5 things to know about Bitcoin this week
"The shorts were sold off and then the longs were sold off. Back to the same price we had an hour ago," analyst Matthew Hyland summarized.
Monitoring resource data purse Calculate the total crypto liquidations for the day at $36 million and $78 million for shorts and longs, respectively.
The views, thoughts and opinions expressed here are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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