Crypto market stays in the green after 25bps Fed cut

The Bitcoin and cryptocurrency market continued its positive momentum after the Federal Reserve implemented its first interest rate cut since Donald Trump’s election victory.

At this month’s Federal Open Market Committee meeting held on November 7, the Federal Reserve announced a 25 basis point reduction in US funding rates and continued the monetary expansion it started in September with a 50 basis point reduction.

Bitcoin (BTC) remained above $76,000 and the overall crypto market remained in the green. While Wall Street rose after the meeting, the CBOE Volatility index fell.

However, cryptocurrency prices generally did not change compared to before the meeting. Social media commentators theorized that FOMC decisions could have smaller impacts on digital asset prices moving forward.

Supporters, meanwhile, noted that the Fed removed language indicating “more confidence in inflation.” Speculators said the changes were likely due to elections and possible changes in monetary policies.

Addressing the discussions, Fed chairman Jerome Powell said central bank regulators would not change their strategies because of short-term inflation data or election results.

The statement changes are not intended to provide forward guidance. The removal of the discourse of greater confidence in inflation is described as a drafting step.

Jerome Powell, Federal Reserve Chairman

Trump and Powell have notoriously disagreed on the Fed’s approach to interest rates. Although Trump appointed the Fed chairman in 2017, he criticized Powell for adopting a conservative interest rate environment. At the time, Trump claimed that Powell’s policies were slowing US economic growth.

Rumors about Powell’s possible resignation circulated after Trump took office in January. Answering questions at the post-FOMC press conference, Powell said he would not resign if asked by Trump.