The Fed has once again left a key interest rate at the same level. The cryptocurrency market responded to the news by moderate growth.
We tell you why the bet at the same level supported the growth of bitcoin and altcoins, which now investors expect from the Fed and representatives of the crypto industry responded to the decision of the regulator.
FRS Solution at Stavka: What you need to know
On March 19, 2025, the US Federal Reserve System decided not to change the key interest rate against the backdrop of uncertainty due to Trump’s economic policy. For the second time in a row, the regulator paused the reduction in bets. The Fed made such a decision largely due to the aggressive “Tariff War” by the administration of President Trump and other large-scale economic reforms.
Fed Chairman Jerome Powell stated at a press conference that the tariffs introduced by President Trump will probably detain progress in achieving the target level of inflation of 2%. The presidential decisions, according to the banker, contributed to an increase in inflation. Now the Fed expected that basic inflation will remain at the level of 2.8% by the end of 2025, which is higher than previous forecasts.
Despite the challenges, Powell retains optimism about the main state of the US economy, especially in terms of labor market stability. The unemployment rate remains low, and economic activity continues to grow stable pace. However, Powell admitted that the “turbulence”, caused by the policy of the Trump administration, complicates the predictions regarding the future inflation rate and the growth of economic activity.
Statements on bets and revised growth forecasts
Although the Fed left the key interest rate in the range from 4.25% to 4.5%, the economic forecasts of the Central Bank now imply minor adjustments. The expected economic growth in 2025 was revised towards the decrease – from 2.1% to 1.7%. Inflation forecasts suggest that it will remain slightly higher than the target level, which confirms the cautious approach of the Fed to possible changes in bets.
The decision to suspend the reduction of interest rates was made because to accept further steps is more clear about Trump’s political actions. Nevertheless, the majority of the Fed’s members still predict at least two decreased bets in 2025.
Stock market reaction and crypts
The stock markets reacted positively to the decision of the Fed. The Dow Jones Industrial Average index increased by 383 points, and the NASDAQ Composite added 1.4%. The Fed’s decision to slow down the reduction in their balance of 6.8 trillion dollars also contributed to the growth of quotations.
Crypticnuts demonstrated positive dynamics. For 24 hours, most cryptocurrencies from the TOP-10 capitalization were valued. Bitcoin, against the background of the solution of the Fed, returned to levels above $ 85 thousand. A positive reaction may indicate that participants in the crypto community are waiting for the regulator to move in the direction of further reduction in the rate. Changes can increase the investment attractiveness of such high -risk assets as a crypt.
Results
The decision of the Federal Reserve System to maintain a bet against the backdrop of the volatile economic policy of Trump emphasizes the complexity and uncertainty of the situation. Although the economy remains relatively stable, inflationary risks and unpredictable changes in politics continue to create calls for the Central Bank. As the events develop this year, the Fed will carefully monitor the dynamics of inflation and economic growth in order to determine the need for further rates of bets.
Forecasts of the crypto community
The opinions of representatives of the crypto industry about how the decision of the Fed has influenced the behavior of the cryptorrhist. For example, the analyst in the Doctor Progit is sure that the market has experienced another pump. He believes that cryptocurrency is immersed in a bear phase. The next goal of Bitcoin, according to Doctor Profit, will be $ 71 thousand. He reinforced his forecast with observations that large players accumulate short positions on BTC. This behavior of whales may indicate that they are waiting for a further immersion of the cryptocurrency course.
Optimists, in turn, are confident that the expectations of a further decrease in the key rate of the Fed is positive for the market. At the same time, investors pay attention to the fact that BTC often repeats the trajectory of movement from previous cycles. Analyst Lark Davis noted that as of the end of March 2025, the position of Bitcoin is very similar to the one in which he ended up at the beginning of autumn 2020 – just before going out in active growth.
The optimistic forecast was also supported by the co -founder of Strategy, the largest investor of Bitcoin among public companies, Michael Sailor. He believes that the actions of the Fed indicate the abolition of the threat of recession in the United States. This situation, Michael Sailor is sure, opens up prospects for further BTC growth. It is waiting for bitcoin more than $ 400 thousand in 2025.
The popular cryptobloger TechDev joined the optimists. He drew attention to the overall growth of global liquidity, which can support the positive dynamics of BTC. Also, the cryptobloger allocated the market position in terms of business cycles. Both signals, in his opinion, indicate the prospects for the further growth of bitcoin.
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Source: Cryptocurrency
I am an experienced journalist and writer with a career in the news industry. My focus is on covering Top News stories for World Stock Market, where I provide comprehensive analysis and commentary on markets around the world. I have expertise in writing both long-form articles and shorter pieces that deliver timely, relevant updates to readers.
