- The Federal Open Market Committee (FOMC) minutes did not suggest whether the Federal Reserve will be taking a dovish or hawkish approach going forward.
- Cleveland Fed President Loretta Mester and St. Louis Federal Reserve’s James Bullard were noted pining for a 50 basis points rate hike.
- Bitcoin and Ethereum, along with many other altcoins, reacted positively to the FOMC minutes.
Also read: Assessing the chances of a Bitcoin price pullback due to FOMC minutes
The minutes of the Federal Open Market Committee (FOMC) meeting from January 31 to February 1 were released with rather bearish expectations. However, the minutes failed to provide cues on whether the Federal Reserve will opt for a 50 bps or a 25 bps rate hike at the next meeting and reiterated that the decisions would depend on incoming data and their implications for the outlook for economic activity and inflation.
The minutes released noted a demand for a 50 basis points (bps) interest rate hike during the last meeting. But the voting members agreed upon a 25 bps hike. The non-voting members that suggested a higher rate hike were Cleveland Fed President Loretta Mester and St. Louis Federal Reserve’s James Bullard. Discussing the same, the FOMC minutes noted,
“A few participants stated that they favored raising the target range for the federal funds rate 50 basis points at this meeting or that they could have supported raising the target by that amount. The participants favoring a 50-basis point increase noted that a larger increase would more quickly bring the target range close to the levels they believed would achieve a sufficiently restrictive stance, taking into account their views of the risks to achieving price stability in a timely way.”
Even though no discussion regarding the next meeting or rate hike was noted, all members of the FOMC agreed that it would be appropriate to continue the process of reducing the Federal Reserve’s securities holdings.
Bitcoin price takes a minor hike
Bitcoin price at the time of writing could be seen trading at $23,865. The biggest cryptocurrency in the world did not react explicitly positively to the FOMC minutes as it increased in value by less than 1%. Ethereum price followed suit and could be seen trading at $1,620, up by 0.5% in the last hour.
BTC/USD 1-day chart
Altcoins such as Cardano, XRP and MATIC noted a relatively greater change. ADA could be seen rising by 1% to trade at $0.384 following the release of the minutes. XRP shot up by nearly 0.9% to change hands at $0.3923. MATIC price, on the other hand, noted a 1.72% increase as well, rising to its current value of $1.38.