What is the impact of the fed fund rate announcement on the cryptocurrency market?

1 answers

• Dec 17, 2021 · 3 years ago
  The impact of the fed fund rate announcement on the cryptocurrency market is significant. When the fed fund rate is raised, it can lead to a decrease in the prices of cryptocurrencies. This is because higher interest rates make traditional investments more attractive, causing investors to sell their cryptocurrencies and invest in other assets. Conversely, when the fed fund rate is lowered, it can result in an increase in the prices of cryptocurrencies. Lower interest rates make traditional investments less appealing, prompting investors to buy cryptocurrencies as an alternative investment. Moreover, changes in the fed fund rate can also affect the trading volume of cryptocurrencies. Higher interest rates can reduce trading activity, while lower interest rates can stimulate more trading in the cryptocurrency market.
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