Bitcoin and ethereum drop, as analysts fear fed minutes will dash hopes for 2023 easing. So this has already happened; it just happened today, we'll get to what the fed minutes told us in a second. but just know that the reason we've been sort of pumping this last week for bitcoin for crypto is because risk assets recently rallied in hopes that inflation has already peaked and the fed would cut interest rates next year.
Now that has already happened, we started to see some weakness in bitcoin's price yesterday, today. Because today is fed minutes day meaning minutes are in part an account of what transpired at the last meeting, but also a tool of monetary policy. fed looks at market reaction post-meeting and uses minutes to correct misunderstandings; there's a lot to correct today.
So, how does Fed Minutes affect you and me as crypto holders? These minutes aren't just a recount of what they said last meeting; the fed often also uses this for communication to talk to the people. The question is whether the fed wants to use these minutes as a communication tool to push back against the view of a 2023 easing cycle.
Meaning that so many people were bullish after the fed's last meeting, because month-to month inflation went down a little even though we're still over eight percent inflation, so many people were bullish that after that last meeting the price started to tick up. Altcoins had huge rallies; the altcoin prices rallied harder.
In these last few days the price has slumped, because of fear of what these minutes may tell us. So what was the prognosis? well breaking news the fed sees interest rate hikes continuing until inflation eases substantially the minute show. so this is not dovish this is hawkish, this is not bullish this is bearish. Also, the minutes tell us the fed expects unemployment rates which have been sort of low in these last few months bullish. They expect unemployment rates to begin rising in 2022 and essentially just to sum this all up fed minutes.
Participants agreed that there was little evidence that inflationary pressures were easing and that the situation would take a long time to resolve. So that is why the bitcoin price has been showing weakness as of late, because it seems the fed is still hawkish. As we get more info we will keep you updated.
