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Interest rates lowered: markets are wobbling – Bitcoin and stocks in free fall!
The Fed cuts interest rates, markets react. Cryptocurrencies fall, Bitcoin and Ethereum under pressure. Find out more about this.
Interest rates lowered: markets are wobbling – Bitcoin and stocks in free fall!
On October 29, 2023, the Federal Reserve announced that it had cut interest rates by 0.25%. This brought the benchmark range down to 3.75-4%. This decision initially brought a positive reaction in the markets, especially in the main indices Dow Jones and S&P 500, which reached record highs. But after Fed Chairman Jerome Powell's press conference, markets fell rapidly. The Dow Jones lost 166 points after rising 200 points earlier, while the S&P 500 fell 0.4% and the Nasdaq Composite fell 0.1%.
Powell noted in his address that further rate cuts in December are not guaranteed because of inflation and labor risks. He emphasized the Fed's data-driven stance and noted the diverse opinions in the committee regarding future actions. This uncertainty led to a broad market reaction that also affected the crypto market.
Decline in the crypto market
Additionally, other major cryptocurrencies such as XRP, Binance Coin (BNB), and Solana (SOL) also recorded losses of at least 3%. These parallel declines in the stock and crypto markets suggest a broad pullback in risk assets, worrying potential investors.
Overall, the October 29 developments in both the stock and crypto markets reflect an unstable market landscape. While the interest rate cut initially caused optimism, uncertainty about future monetary policy measures brought renewed volatility. For investors, it remains to be seen how the situation will develop in the coming months.