The Federal Reserve is expected to raise the target federal funds rate on Wednesday for the first time since the start of the pandemic. As the Russia-Ukraine conflict rages in Europe, analysts and economists are overly focused on this important event. Investors are wondering how stock markets, Bitcoin and altcoin prices, and investments like precious metals will react to the news if the Fed decides to raise the rate from zero by a quarter point.
25 basis points increase expected from FED: How will Bitcoin and gold be affected?
Last week, the world watched the financial sanctions against Russia and the price of gold reach $2,060. Energy shares, oil and numerous commodities have also gained significantly over the past seven days. The cryptocurrency markets were sluggish last week, volume plummeted, and the movement remained stable after a brief price spike on March 9, 2022. On the other hand, stocks suffered greatly and indices such as NYSE, Dow Jones, S&P 500 and Nasdaq closed the week in red.
To make things worse, it was the data from the US Department of Labor’s CPI report. As Cryptokoin.com has previously reported, the important event this week for all the markets mentioned, such as Bitcoin, gold, will be Wednesday. The US Federal Reserve is expected to raise interest rates for the first time since the Covid-19 pandemic. The increase is only expected to be a quarter-point increase, but investors are wondering if the Fed will raise rates for the rest of the year.
What are the prospects?
During a panel discussion on March 11, Oxbow Advisors managing partner Ted Oakley said he expects a 25 basis point increase this Wednesday. CME’s Fed Monitoring Tool also expects the US central bank to raise rates by 0.25 percentage points. Moody’s Analytics chief economist Mark Zandi said at Tuesday’s House Financial Services Committee meeting that he thinks it’s a good idea to continue normalizing rates. Meanwhile, the crypto markets, at the beginning of the week, remain sluggish.
Gold and Bitcoin investors will watch the Fed’s move on Wednesday to see if it negatively impacts the markets. Since this move of the FED has been expected for a while, some experts think that the markets may not be seriously affected. But time will tell exactly how the market will react.
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