Crypto Market Falls as Fed’s Williams Supports 5-5.25% Rate Hike

Broader losses in the cryptocurrency market pared earlier gains as US Federal Reserve Bank President John Williams agreed that Fed officials’ forecast of interest rates in a range between 5% and 5.25% for the year 2023 is still reasonable.

Bitcoin price fell over 2% after John Williams’ comment and BTC price is currently trading at $22,795.

US Fed President John Williams predicted a maximum interest rate of 5.25%

New York Federal Reserve President John Williams said on February 8 that economic conditions appear roughly in line with the likely outlook for monetary policy. The US Federal Reserve is expected to raise its inflation target to 2%.

“My view is that it still looks like a very reasonable view of what we’re going to need to do this year to balance supply and demand and bring down inflation,” he said during a moderated discussion with the Wall Street Journal in New York. .

US Fed officials have forecast a rate hike of up to 5.1% by the end of 2023. However, he says most officials’ rate forecasts in the 5-5.25% range are “still a reasonable view.”

The US Fed raised interest rates by 25 bps to a range of 4.5% to 4.75% last week amid slowing inflation and strong jobs data. Williams believes further rate hikes will depend on incoming data. Also, the Fed pivot is out of focus so far as inflation needs to come down more.

The crypto market resonates lower

Bitcoin price fell over 2% from the day’s high of $23.3k to $22.7k. The price is currently trading at $22,830. The US dollar index ( DXY ) is jumping higher at 103.50 as the Fed is likely to continue raising interest rates this year.

The broader cryptocurrency market followed suit, with altcoins such as Ethereum, Dogecoin, Cardano, Shiba Inu and others also down more than 2%. Ethereum price is trading at $1,633, down 2% from a 24-hour high of $1,688.

Also Read: Top 5 Crypto Tokens & AI Crypto Projects Ready to Launch in 2023

Varinder is a technical writer and editor, tech enthusiast and analytical thinker. Fascinated by Disruptive Technologies, he has shared his knowledge on Blockchain, Cryptocurrencies, Artificial Intelligence and Internet of Things. He has been associated with the blockchain and cryptocurrency industry for a significant period and currently covers all the latest updates and developments in the cryptocurrency industry.

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