Crypto markets await another major rate hike decision by the U.S. Federal Reserve. because the banking crisis and the debt ceiling crisis increase the risk of "economic catastrophe". Bitcoin and Ethereum prices continued their upward momentum as the Fed is expected to raise rates by another 25 basis points after its monetary policy meeting on Wednesday, bringing lending rates to 5%-5.25%.
Market sentiment for the next few weeks depends entirely on Fed Chairman Jerome Powell's guidance on future rate hikes. The Dow Jones, S&P 500 and Nasdaq futures markets traded higher on lower GDP growth and lower income for the first quarter. The collapse of First Republic Bank has renewed fears of a banking crisis, but JPMorgan predicts the banking crisis is almost over.
Former Federal Reserve Bank of Dallas President Robert Kaplan said the US Federal Reserve should consider a pause in hikes. He believes the banking crisis is just beginning as shares of US regional lenders fell sharply on Tuesday.
JPMorgan's chief market strategist Tai Hui insisted the economy is slowly slowing as job opening data is released on Tuesday. He believes the Fed should raise rates by another 25 basis points and then pause.
Wall Street banks as a whole forecast a 25 basis point rate hike this month. Barclays, Goldman Sachs, JPMorgan, Morgan Stanley and others predicted rate hikes before starting to pause. Based on CME data, the probability of a 25 bps rate hike is almost 89%.
The price of BTC jumped 2% in the last 24 hours, with the price currently trading at $28,652. The 24-hour low and high were $27,935 and $28,881 respectively. Additionally, trading volume has increased slightly by 5% in the past 24 hours, indicating interest among traders.
The US dollar index ((DXY) fell to a low of 101.51 today. The DXY is showing volatility and is likely to jump higher after the Fed rate hike. It will put some pressure on the price of Bitcoin. However, positive sentiment will overcome Powell's indication to stop the rise .
