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Top Crypto News Today: Bitcoin, Ethereum & Crypto Markets Dips on Release of Fed Minutes

Top Crypto News Today: BTC, ETH Price Drop with Possible Fed Minutes Outcome

The Fed has been making headlines for creating a financial plan to tame the rising inflation. Risk assets have shown an uptrend in the hope of the Federal reserve slashing interest rates sooner. Interestingly, BTC and ETH futures tied to the S&P 500 are trading weak.

When the Fed Reserves raised interest rates by 0.75 point basis, the crypto markets fell like a pack of cards. The FOMC- Federal Open Market Committee takes place eight times a year. July 2022’s FOMC minutes of the meeting have been released. The committee plans to double the balance sheet shrinkage in September 2022. The committee has already shipped a liquidity tightening scheme to help combat the rising inflation that has already caused job insecurity, businesses going down, and layoffs in most sectors. 

“Fed looks at market reaction post meetings and uses minutes to correct misunderstandings. There is a lot to correct today,” Joseph Wang, former Fed trader tweeted. 

Members of the committee said that the interest rates must be relooked and revised based on market contingency and the responses from sectors. The committee also added that the tightening of these policies and rates must be adjusted to assess the actual inflation rate. 

An important pattern to observe is that the markets both crypto and traditional were being neutral if not in red. As the time of the meeting minutes release came closer the price of some crypto assets and other stocks dipped. Ethereum and Bitcoin Price suffered 2 and 2.5% drop respectively. 

The volatility in crypto markets may increase if the Fed minutes keep impacting the overall financial market. Bullish investors are preparing themselves to get their investments aligned with Fed’s pushback against the hopes of investors on seeing a cut on interest rates which clearly won’t be happening soon.  

According to the members of the committee the inflation rate was beyond any control and needed this tightening to get the inflation rate below or at 2%. The Federal Reserve had cut interest rates by a total of 1.5 percentage points at its meetings on March 3 and March 15, 2020 to help the economy stay afloat during the crisis. The Fed minutes release also impacted the US stock market. At the time of writing, Dow Jones dropped 0.1%; the S&P 500 by 0.2%; and the Nasdaq, 0.6%.

Additional Read: Bitcoin Price Prediction Weekly

A step back in time 

The Federal Reserve announced an interest rate hike by 75 points in mid July this year which shook the crypto market by all means. The US Securities had hinted that the interest rates may increase depending on the economic revival. For the first time in history, the central bank interest rates rose to 2-2.50%   

Bitcoin price spiked immediately after the Fed’s meeting on May 3 and 4, but then began to decline significantly on May 6. After which ETH too sank by 0.07%. 

Additional Read: Bitcoin Price below $24000

Source: CoinDesk

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