How does FOMC affect the price of digital currencies?

3 answers

• Dec 16, 2021 · 3 years ago
  The FOMC plays a significant role in influencing the price of digital currencies. As the central bank of the United States, the decisions made by the FOMC regarding interest rates and monetary policy have a direct impact on the economy. When the FOMC announces a change in interest rates, it can affect the value of the US dollar, which in turn can impact the price of digital currencies. For example, if the FOMC raises interest rates, it can strengthen the US dollar and potentially lead to a decrease in the price of digital currencies.
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• Dec 16, 2021 · 3 years ago
  The FOMC's decisions can create uncertainty in the market, which can impact the price of digital currencies. Traders and investors closely monitor FOMC meetings and statements for any indications of future monetary policy changes. If the FOMC's actions are unexpected or deviate from market expectations, it can cause volatility in the digital currency market. Traders may react by buying or selling digital currencies, which can influence their prices.
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• Dec 16, 2021 · 3 years ago
  According to a recent analysis by BYDFi, the FOMC's announcements and decisions have a statistically significant impact on the price of digital currencies. The study found that on average, digital currencies experience a temporary increase in price following a decrease in interest rates by the FOMC. However, the impact varies depending on market conditions and other factors. It's important for traders and investors to stay informed about FOMC decisions and their potential impact on digital currencies.
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