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ECB and Fed Raise Interest Rates: Bitcoin (BTC) Unaffected

Author

Jonathan Gibson

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Reading time

2 mins
Last update

Author

Jonathan Gibson

Tags

Reading time

2 mins
Last update

Author

Jonathan Gibson

Tags

Reading time

2 mins
Last update

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The European Central Bank (ECB) and the U.S. Federal Reserve (Fed), raised interest rates once again. This is the ninth consecutive interest rate increase in the Eurozone and the eleventh time in 17 months that the Federal Reserve has hiked the overnight bank lending rate. Bitcoin (BTC), the largest cryptocurrency in the market, operated today without changes. 

ECB and Fed Hike Interest Rates

With inflation rates growing worldwide in recent years, interest rates continue to go higher in most developed economies. Furthermore, despite the lowering pace of inflation growth, price increases are still far from the 2% goal of most central banks. Interest rates in the United States reached the highest level in 22 years at 5.5%. 

Greg McBride, chief financial analyst at Bankrate.com said about inflation:

“Despite the euphoria over inflation coming down from 9.1% to 3% in the past year, the trend on core inflation readings, which exclude volatile food and energy components to provide a better read on inflation trends, is much less impressive.”

At the same time, the ECB has also increased the benchmark deposit rate to 3.75%, the highest point since 2001. At that time, the Eurozone was trying to strengthen the euro against other currencies such as the U.S. dollar (USD). 

Meanwhile, inflation rates on Bitcoin (BTC) continue to go lower. Next year, Bitcoin will experience a new halving event, reducing the new issuance of BTC to 3.125 BTC per block from 6.25 BTC nowadays. 

According to CoinGecko, Bitcoin is now being traded at $29,300 and it has not moved in the last 24 hours. Other virtual currencies are also experiencing no change in recent hours.