Last Updated on May 4, 2023 by Bitfinsider
The Federal Reserve of the United States has increased the federal funds target range rate by 25 basis points, to 5-5.25%.
The interest rate decision on Wednesday was widely anticipated, as traders had already priced in an increase. The Fed’s statement no longer indicates future rate increases.
“In determining the extent to which additional policy tightening may be necessary to return inflation to 2 percent over time, the Committee will consider the cumulative tightening of monetary policy, the lags by which monetary policy affects economic activity and inflation, and economic and financial developments,” read the Fed’s statement.
In its March statement, the Fed said, “The Committee anticipates that some additional policy firming may be appropriate in order to achieve a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time.” The language in today’s release is more moderate.
“One and done is the Fed policy prediction based on the pricing of U.S. interest rate futures,” Trakx’s Ryan Shea told The Block prior to the decision, indicating that today’s 25 basis point hike will mark the end of the most aggressive U.S. monetary tightening cycle in four decades.
“Given the ongoing tension in the U.S. banking sector, which just claimed its third victim with JPMorgan’s acquisition of First Republic Bank last week,” he added, “investors anticipate a relatively swift reversal in Fed policy.”
Hardware wallets are safe and secure devices that can be used offline. They keep your cryptocurrency offline, making it impossible for you to be hacked. To find out more on the leading hardware wallets, you may view our reviews here: Ledger & Trezor
Disclaimer: The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, legal, tax or other advice. Investing in or trading cryptocurrency or stocks comes with a risk of financial loss.