- Upcoming FOMC meeting negatively impacts altcoins
- Impact of the ‘Roaring Kitty’ incident adds to the crash
- Federal Reserve Chair Jerome Powell petitioned to consider reducing rates
The current downturn in the market is largely due to the anticipation of the forthcoming Consumer Price Index (CPI) announcement and the Federal Open Market Committee (FOMC) gathering this Wednesday. It’s common for crypto markets to dip ahead of such events.
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Statements made by Federal Reserve Chair Jerome Powell in the past have triggered significant downturns in cryptocurrency values. In the weeks leading up to the last two FOMC meetings, Bitcoin’s value fell over 10%, and other cryptocurrencies saw declines exceeding 20%, similar to what occurred in March.
According to the post above, Roaring Kitty has been a major influence, causing a drop in the prices of alternative cryptocurrencies. Following a decline in GameStop’s stock last Friday, a wider market slump ensued, with certain cryptocurrencies plummeting by over 20%.
Moreover, the robustness of the U.S. Dollar and the ongoing process of quantitative tightening (QT) are dampening prospects for the growth of alternative cryptocurrencies, contributing to a persistent bearish trend.
Despite the prevailing pessimistic mood, there are indicators of a potential recovery. Market trends show a swift rebound following FOMC meetings. Post-meeting, Ethereum has typically climbed about 20%, and since the previous Federal Reserve meeting, Bitcoin has surged over 20%.
The investment community is keeping a vigilant eye on developments. Additionally, increasing national debt in the U.S. and faltering economic indicators may signal an impending cut in interest rates.
Senator Elizabeth Warren, along with her peers, has petitioned Federal Reserve Chair Jerome Powell to consider reducing rates. The objective is to alleviate the financial strain on Americans grappling with soaring housing and insurance expenses.
The unemployment rate is on the rise and the European Central Bank (ECB) is already initiating rate cuts. However, it appears likely that the Federal Reserve may reduce rates to stave off a looming recession.
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