Fed Hints At Pause After Another 25bps Hike
Markets Trade Sideways With Ether Up 1%
Markets remained little changed after the Federal Reserve hiked interest rates for the 10th straight time, nudging the benchmark US rate up by another 0.25%.
While equities turned lower after the decision, with the S&P 500 closing down 0.7%, crypto markets are trading sideways. Bitcoin is flat, and Ether is up less than a percentage point.
BTC, ETH and QQQ
ETH Price + BTC Price + QQQ Price, Source: The Defiant Terminal
Today’s hike could be the last in this series if economic conditions worsen, as the central bank said that any further increases would be data-dependent – a significant departure from its March statement, which “anticipate[d] that some additional policy firming may be appropriate.”
Earlier in the day, a report from payroll-processing firm ADP showed that the private sector added 296,000 jobs in April, a nine-month high. This indicates that the US jobs market remains resilient in the face of tightening credit conditions.
At a press conference following the decision, Fed chair Jerome Powell called the revised language a “meaningful change.”
Investors are taking note. Fed funds futures already indicate a 90% probability of rates remaining unchanged in June, and predict rate cuts by the end of the year.
A more accommodative stance by the US central bank would likely be a tailwind for crypto, which tends to thrive along with other risk assets like stocks when there is ample liquidity.
Decentralized exchange Curve’s CRV token is up nearly 7% in the past 24 hours after the project deployed a smart contract related to its upcoming crvUSD stablecoin. Curve is DeFi’s fourth-largest protocol, with $5B in total value locked.
CRV Price, Source: The Defiant Terminal
Rocket Pool (RPL), the second-largest liquid staking protocol, is up over 5%.
Among the top 100 digital assets by market capitalization, decentralized exchange Pancakeswap and liquid staking leader Lido have fallen around 9% over the past week.
Radix, a layer 1 blockchain, is the worst performer with a 20% drop, according to Coingecko.