The Federal Open Market Committee of the Fed showed the consensus of the need to reduce the increase rate. The drop of the US dollar index by more than 0.9% to 105.7 is a good driver for the Bitcoin price.
Bitcoin (BTC) and other cryptocurrencies recently received another positive sign of recovery from the US Federal Reserve (Fed). The government agency released data on the slowdown of interest hikes, bringing hope to the crypto market.
The Federal Open Market Committee (FOMC) of the Fed showed the consensus of the need to slow interest rate hikes.
They reported that monetary policy approaches a tight enough position to meet the objectives of the Committee. Therefore, they said they needed to reduce the rate hike within the target range for the federal funds rate.
Immediately after the release of the data, the crypto market reacted optimistically. The price of Bitcoin slightly recovered from USD 16,300 to USD 16,700 before gaining regular bullish momentum.
The Drop of the USD Dollar Drives Bitcoin Higher
On the other hand, the data on the reduction of interest rate hikes by the Fed hampered the US dollar index (DXY). It dropped by more than 0.9% over the last 24 hours to trade at 105.7, a good driver for Bitcoin.
However, it is still impossible to determine whether the Fed can recover the market this time. Cryptocurrencies seem to have diverged considerably from US macro and stock market data due to the impact of the FTX collapse.
US stocks continued rising significantly last week as the S&P 500, Nasdaq 100, and Dow Jones recovered what they had lost. However, the price of Bitcoin remains stable at the USD 17,000 level.
The risk to the Bitcoin mining community is another potential threat that might wreak havoc on the market. A complex spending environment, chaotic business operations, and disastrous movements in the value of BTC have pushed them to the highest levels of stress since 2021.
The Number of Unemployment Claims Increases from 17,000 to 240,000
Last week, a wave of layoffs at tech companies led jobless claims to reach a three-month high. The Labor Department recently reported the US citizens filing for unemployment benefits increased from 17,000 to 240,000. According to a survey conducted by Bloomberg, economists consider the average figure is 225,000.
From November 6th to 12th, the continuous claims rose from 48,000 to 1.55 million, including those receiving unemployment benefits for over a week. That increase, the highest figure since March, represents the accumulated total for the sixth consecutive week.
The Massive Layoffs Worldwide Lead the Leading Cryptocurrencies to Rise
Economists, harbingers of recessions historically, have paid closer attention to continuous claims over recent weeks. Although the indicator has risen from its low in May, it remains below last year’s all-time high.
Since unemployment in many tech companies grew during the lockdown period, the rise in layoffs may not suggest a broader economic downturn. The explosion of online businesses occurred before the World Health Organization declared the Coronavirus a pandemic.
The price of Bitcoin has risen by more than 2% in response to the increase in US unemployment claims. Meanwhile, Ether (ETH) has climbed by 4% over the last 24 hours.
By Alexander Salazar
