The Bitcoin and cryptocurrency market maintained its positive momentum after the Federal Reserve implemented its first rate cut since Donald Trump’s election victory.
On November 7, the Federal Reserve announced a 25 basis point reduction in U.S. funding rates at this month’s Federal Open Market Committee meeting, continuing the monetary easing begun in September with a reduction of 50 basis points.
Bitcoin (BTC) remained above $76,000 and the total crypto market remained solidly in the green. Wall Street surged after the meeting while the CBOE Volatility Index fell.
However, cryptocurrency prices remained largely unchanged from before the meeting. Social media commentators have speculated that the FOMC’s decisions may have less of an impact on digital asset prices in the future.
At the same time, supporters noted that the Fed removed language indicating “greater confidence in inflation.” Speculators said the changes were likely due to the election and possible changes in monetary policies.
Addressing the debates, Fed Chairman Jerome Powell said central bank regulators would not change strategy because of near-term inflation data or election results.
Changes to the statement are not intended to serve as forward-looking guidance. Removing language on greater inflation confidence is considered a drafting step.
Jerome Powell, Chairman of the Federal Reserve
Trump and Powell have notoriously clashed over the Fed’s approach to interest rates. Despite his appointment as Fed chair in 2017, Trump criticized Powell for adopting a conservative rate environment. At the time, Trump claimed that Powell’s policies were slowing U.S. economic growth.
Rumors are swirling about Powell’s potential resignation once Trump takes office in January. Answering questions at a post-FOMC news conference, Powell said he would not resign if Trump asked him to.
