Digital currency prices rose during trading on Monday, as markets awaited central bank meetings this week regarding monetary policies.
It is widely expected that the US Federal Reserve will stabilize interest rates at current levels at its next meeting on Wednesday of this week, which has provided notable support to the digital currency market over the past few hours.
The price of Bitcoin rose by about 3%, breaching the $27,000 level during the last 24 hours.
The rebound comes as Fed rate-linked futures indicate a 99% chance the US central bank will leave interest rates unchanged between 5.25% and 5.5% on Wednesday. Futures also show a 69% chance of holding rates in November and a 58% chance of the same in December. The central bank has raised interest rates by 525 basis points since March 2022 to tame inflation, a so-called liquidity tightening that is seen as partly responsible for last year's crypto collapse.
“No one really expects a change in interest rates at this meeting,” Scotiabank said in a preview note to clients on Friday. Instead, the focus will be on future monetary policy guidance, updated macroeconomic forecasts, and remarks from Fed Chair Jerome Powell. .
The Fed will issue a policy decision on Wednesday accompanied by a statement and full update on economic forecasts in the Summary of Economic Outlook.
“The FOMC is likely keenly aware of the fact that there were three previous weak releases of inflation during the pandemic that were subsequently followed by an acceleration in inflationary pressures,” Scotiabank wrote, referring to the FOMC.
Analysts at ING do not expect the Fed to continue raising final forecasts. This rebound in Bitcoin likely stems from the belief that the Fed's tightening cycle is over. The digital currency relies widely on the availability of liquidity and is more sensitive to changes in interest rate expectations than stocks.
Cryptocurrencies today
The combined market value of the crypto market during these moments of today’s trading amounted to approximately $1.08 trillion. The trading volume reached approximately $26.07 billion.
Bitcoin rose during the last 24 hours to the levels of $27,240, by 2.9%, while recording weekly gains of 6.5%. Its market value now reaches $520 billion.
While Ethereum, which is the largest digital currency by market value after Bitcoin, rose by about 2% during the last 24 hours, reaching $1,655, with weekly increases of 4.5%, and a market value of about $196 billion.
The price of Binance Coin rose by 2.2% to record $219.
While the price of Ripple XRP rose by 0.8% to $0.50217.
Cardano witnessed a rise to $0.2543, by 1.6%, while it rose during the last 7 days by 3.9%.
On the other hand, Dogecoin rose to the level of 0.062427, by 0.5% during the last 24 hours.
