Bitcoin has shown significant volatility surrounding Federal Open Market Committee (FOMC) meetings. Analysis of historical data suggests that Bitcoin often sees a decline in value prior to the FOMC’s interest rate decisions, followed by notable gains after the announcements.
Bitcoin experiences a dip before the FOMC meeting, followed by a rally after the Fed’s decision.
The Federal Open Market Committee (FOMC), a division of the Federal Reserve System, oversees the nation’s open market operations and makes crucial decisions regarding interest rates and monetary policy. These meetings occur approximately eight times a year and involve in-depth discussions on the performance of the US economy and the factors influencing it.
On December 13, 2023, the FOMC opted to maintain rates between 5.25% and 5.50%. Prior to this decision, Bitcoin experienced an 8.76% decline, followed by a 22.07% surge after the announcement. This pattern repeated on January 31, 2024, when the FOMC once again held rates steady, resulting in a 4.55% drop in Bitcoin’s value before the meeting and a subsequent increase of 26.34%.
The trend persisted on March 20, 2024, as Bitcoin declined by 11.82% before the FOMC meeting and then rose by 18.09% post-decision. Similarly, on May 1, 2024, Bitcoin s
aw a 12.69% decline before the rates were held steady, followed by a 15.95% rise after the announcement.
With the upcoming FOMC meeting on June 12, 2024, Bitcoin has already experienced an 8.25% drop. US Senators Elizabeth Warren, Jacky Rosen, and John Hickenlooper have urged the Federal Reserve to consider rate cuts, highlighting concerns over the current monetary policy’s impact on inflation and the economy.
