The Bitcoin and crypto market could receive a boost in confidence following the Federal Reserve’s close-door meeting today.
For context, the U.S. Federal Reserve is holding a closed-door meeting today, April 7, 2025, to review the discount rates charged by Federal Reserve Banks. Though the meeting was scheduled in advance and is not a direct response to the recent financial market turmoil, investors have now taken an interest.
Federal Reserve Meeting Amid Bitcoin and Market Downturn
It is important to note that the Federal Reserve is not expected to decide on interest rate cuts within this meeting. However, the reason behind investor interest is that the outcome of this meeting could hint at how the Fed might approach interest rates at the next Federal Open Market Committee (FOMC) meeting scheduled for May 6 to 7, 2025.
With the financial markets rattled by President Donald Trump’s sweeping tariff announcement, Bitcoin and the broader crypto market have entered a steep downtrend. The sudden imposition of tariffs, seen by analysts as a protectionist shock to the global economy, has led to a flight from risk assets.
Major U.S. indices have reacted sharply, with the Dow Jones falling nearly 4,000 points over two days and the S&P 500 sliding into bear market territory. The tech-heavy Nasdaq has recorded a near 19% drop year-to-date.
Bitcoin has not escaped. At the time of writing, it trades around $78,016, down over 5.35% in the past 24 hours, with intraday lows near $74,500. Ethereum is seeing even steeper losses, falling more than 10% to around $1,548. The altcoin market mirrors the sentiment, with tokens like XRP sliding to five-month lows.
Could The Federal Reserve Effect Interest Rate Cuts Next Month?
However, there may be a change in policy winds that could benefit crypto assets. As The Crypto Basic confirmed today, JPMorgan’s global head of fixed income, Bob Michele, recently discussed this during a Bloomberg interview.
He noted that last week’s twin-day crash on Thursday and Friday was the fourth of its kind in American history, placing it in the same league as the crashes of 1987, 2008, and 2020. In each of those historical precedents, the Federal Reserve stepped in with aggressive interest rate cuts.
Michele believes the current market conditions are far from normal and argues that the Fed may need to act more urgently than it currently signals. While Chair Jerome Powell has been cautious, voices like Michele’s are pushing the narrative that an early rate cut may be necessary.
If the Federal Reserve’s decisions in today’s closed-door session does hint at interest rate cuts next month, this could boost investor confidence, possibly contributing to a recovery from the latest bloodbath.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
