A Look at Bitcoin Price Movement Entering a Low Interest Rate Regime

Todaysgist, News Following the Fed’s decision to cut interest rates by 50 basis points, the crypto market has seen a significant increase, especially in Bitcoin, since Monday, September 23, 2024.

Tokocrypto trader Fyqieh Fachrur explained that Bitcoin prices are trading slightly below their highest point in a month, following the increase that occurred throughout last week.

“This decision exceeded economists’ expectations who predicted a cut of only 25 basis points, marking the first cut in the last four years,” Fyqieh said in an early week analysis, quoted Wednesday (25/9/2024).

Fyqieh said the Fed’s move was seen as a positive catalyst for the crypto market, which is considered a risky asset.

Bitcoin, which is the leading indicator in this market, has not returned to its record high of USD 73,800 or equivalent to IDR 1.11 billion (assuming an exchange rate of 15,168 per US dollar) which was reached in March 2024.

Positive Impacts of Low Interest Rate Regime

The shift to a rate cut regime has had a significant positive impact on crypto. Over the past few years, international macroeconomic conditions have had a greater impact on crypto prices than any other factor.

“The Fed cuts interest rates to manage inflation, create jobs, and maintain economic stability. However, this policy must be implemented carefully so as not to trigger a new inflation cycle,” Fyqieh explained.