Skip to main content

Rate hike by 50 basis points: US central bank wants to fight inflation more vigorously

 


The US Federal Open Market Committee (FOMC) announced after a two-day meeting on Wednesday that interest rates would be raised by 50 basis points, or 0.5 percent. Such a decision was already expected in advance. This is the second of an expected seven interest rate adjustments this year. In March, the US Federal Reserve raised interest rates by 25 basis points, or 0.25 percent, the first hike since 2018.


Markets were already braced for Wednesday's rate hike, which was the largest since 2000. It was therefore expected that the immediate reaction to this decision would be non-existent. US Federal Reserve Chair Jerome Powell indicated in April that there would be a 0.5 percent adjustment. Immediately following the central bank's announcement, risky assets such as stocks and even cryptocurrencies have surged.

Bitcoin ( BTC ) has fallen over 40 percent since the US Federal Reserve announced interest rate hikes in November . Following the March decision, BTC was hovering around $41,000. It's currently under $40,000.


With this interest rate hike, the FOMC wants to combat rising inflation, which reached 8.5 percent in March, the highest level in four decades . Many economists have criticized the US Federal Reserve for being too slow in tackling inflation and therefore prone to overreacting. The Fed left interest rates at zero to support the economy in the wake of the corona pandemic. In 2021, she has wrongly labeled the inflation spike as "temporary". With the war in Ukraine and renewed lockdowns in China, global inflationary pressures have now increased even further.


The Fed also announced on Wednesday that it intends to reduce its balance sheet and sell bonds and securities in the process. The balance sheet has doubled to $9 trillion since the pandemic began. At best, this will result in a temporary shock to financial markets. However, this step could also have negative effects in the longer term.


After the committee vote, Powell gave a press conference where he assured Americans that the Federal Reserve was "working swiftly" to bring inflation under control. He said the central bank believes incremental hikes of 50 basis points are appropriate to bring inflation within the current 2 percent target range. He also said the committee would not consider hikes of 75 basis points. Future rate adjustments would be closer to 25 basis points.


US President Joe Biden said the Treasury Department will reduce the national debt this quarter. This will also help fight inflation. US Treasury Secretary Janet Yellen told a Wall Street Journal event on Wednesday that she expects continued economic growth this year and a "soft landing" on inflation without a recession.

My Top Picks
Honeygain - Passive earner that pays in BTC or PayPal
MandalaExchange -The Best no KYC crypto Exchange! 
BetFury - Play And Earn BFG for daily Bitcoin and ETH dividends!
Pipeflare - Faucet that pays in ZCash and Matic, Games pay in DAI
Womplay - Mobile dApp gaming platform that rewards in EOS and Bitcoin
Cointiply - The #1 Crypto Earning Site
Torum - Join the latest Social Network and earn TRM for Free! 
LiteCoinPay - The #1 FaucetPay earner for Litecoin 
LBRY/Odysee - YouTube Alternative that lets you earn Money by viewing videos!
FaucetPay - The #1 Microwallet Platform
FREEBTC - The #1 FaucetPay earner for Satoshi's
FaucetCrypto - An earning/faucet site that pays out instantly
FireFaucet - An earning site that pays better for some than Cointiply
DogeFaucet - Dogecoin Faucet
xFaucet - BTC, ETH, LTC, Doge, Dash, Tron, DGB, BCH, BNB, ZEC, FEY - Claim every 5 minutes
Konstantinova - BTC, ETH, LTC, Doge, Dash, Tron, DGB, BNB, ZEC, USDT, FEY, 25 Claims Daily

Comments

Post a Comment

Popular posts from this blog

From offchain to offchain: Statechains meets Lightning

  Without a doubt, the most significant off-chain Bitcoin solution is the Lightning network. But in its wake, the statechain has emerged as an intriguing replacement. There is currently a proposal to link the two offchain networks. From an ocean, for example, you can see sunbeams glistening in the water, waves rippling, and possibly a jellyfish drifting toward the light. But you only see a small portion of it. The distance from the sea's surface to its bottom is hundreds of meters. It has dozens of different fish species swimming in it, crabs and starfish crawling on the bottom, shells clinging to rocks, and sea plants climbing up. A completely new world starts where your gaze diverges. You can picture a blockchain like Bitcoin, just like the sea. What you see on the outside is only a small portion of what is actually there; the set of UTXOs (coins) and transaction history that full nodes store are just the beginning of a much larger world. It's the plan, at least. With Bitcoin
Post a Comment
Read more

MSP Recovery and Tokenology aim to optimize healthcare with the help of Polygon

  MSP Recovery LLC, a Miami, US-based healthcare provider with an estimated enterprise value of $32.6 billion, is partnering with Web3 company Tokenology to jointly launch a new blockchain platform called Lifechain. Lifechain wants to leverage the verifiable and transparent nature of blockchain technology to aggregate medical care claims, medical expense reports and patient data and streamline their processing. For this purpose, MSP Recovery launched its own LifeWallet in January, which already has 1 million users. In addition to the wallet and blockchain platform, an associated crypto token called LifeCoin is also used. The press release explains that the primary purpose of the system is to enable secondary healthcare providers to more effectively bill health insurance companies for their costs. “The number of medical claims tokenized going forward will surpass $50 million per day by 2024. For this we need scalability, security and sustainability, which we have only found with Polygon
Post a Comment
Read more

Phishing attack on popular crypto sites tries to empty wallets

  Several major crypto sites such as Etherscan, CoinGecko, DeFi Pulse, and others report malicious pop-ups scammers use to try to trick users into connecting their MetaMask wallets. The phishing attack came from a domain displaying the Bored Ape Yacht Club (BAYC) logo. "We are investigating the root cause of this attack to fix the threat as soon as possible," CoinGecko founder Bobby Ong tweeted. The phishing attack appears to have been triggered by a malicious ad script from Coinzilla, a crypto ad network, according to CoinGecko. Etherscan also advises its users not to confirm any transactions that may appear on the website. The attackers attempted to use the hype around the “bored monkeys” non-fungible tokens (NFT) to gain access to the cryptocurrencies of unsuspecting website visitors. Although the websites affected by the scam attempt have reacted in the last few hours and deactivated the advertising pop-up, it is still recommended not to connect your MetaMask wallet to ne
Post a Comment
Read more