The U.S. Federal Reserve has just cut interest rates by 50 basis points, which was a 'unanimous' decision, CNBC reports. This measure was necessary to combat the devastating impact of the coronavirus scare on the U.S. economy.
The price of Bitcoin (BTC) clearly reacted to the Fed decision. Due to a wave of excitement, traders pumped BTC more than 1.6 percent in a span of several minutes along with stocks and gold.
However, this price gain was short-lived. The leading cryptocurrency swiftly retraced its sudden gains and reached an intraday low $8,677. Notably, the Dow, the leading U.S. stock market index, also turned negative after the rate cut.
More money printing
While Bitcoin is believed to be an uncorrelated asset that doesn't care about U.S. economic policy.
Anthony Pompliano of Morgan Creek Digital described rate cuts as 'rocket fuel' for Bitcoin when the Fed cut rates by 25 basis points in September 2019, but the top cryptocurrency didn't budge on the news back then.
Meanwhile, U.S. President Donald Trump calls for more easing and cutting, which Pompliano slams as "money printing."
Bitcoin's recent move proves that it can indeed trade the Fed, according to market analyst Alex Krüger.
In August 2019, the BTC price dropped more than six percent after Fed Chairman Jerome Powell voiced his concerns about crypto.
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