crypto crypto markets crypto news inflation the highest it's been in decades is it 8.5 right now and the federal reserve is going to do somethin about it in this week's artecle we'll cover inflation bonds and how higher interest rates could affect the crypto markets i'm your host chris merkel and this is exodus crypto news
jerome powell the chairman of the federal reserve has stated that he'd like to see inflation get back to two percent wouldn't we all to get there the fed is planning a series of rate hikes that will go into effect throughout the rest of this year and into next year we already saw a 25 basis point rate height in march and pal has indicated that the feds planning to raise rates by half a percent in may and. here's pal in his own words and i quote it is appropriate in my view to be moving a little more quickly i would say 50 basis points will be on the table fornthe may meeting no matter how much the fed raises rates in may the bond market is already deep into the fastest sell-off of the 21st century fro january 1st the 10-year treasury note a commonly used benchmark for bonds rose 70 percent from a 1.7 percent to 2.9.
demand from customers Mortgages and credit cards are more expensive, and consumers are encouraged to save since the interest on their savings account is somewhat higher. In the stock market, greater borrowing costs can compel traders and investors to close out leveraged positions and sell off those assets. Raising interest rates has the net effect of removing oxygen from the economic fire, which is now burning more slowly. We understand how rates impact growth, but what we don't understand is how rates increase inflation.
What we don't know is how a higher interest rate environment would influence crypto. This will be the first time the crypto markets have to deal with higher rates, and there are a few ways it might affect the market. The increasing cost of borrowing may push leverage crypto investors to liquidate their positions, causing the crypto markets to wash out and reset at lower values. Higher rates also increase the opportunity cost of keeping bitcoin because there are more options to invest in other yield-generating assets. No one can predict what effect higher rates will have in the end.
rates on crypto will be we can only make an educated guess and size our positions accordingly what's your opinion what do you think higher interest rates are going to do to the crypto market let usknow in the comments below thanks for watching everyone we've got a lot more artecle for you so just click any of these to keep watching until next time hold on
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