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The bitcoin price fell below $20,000 amid concerns about a large interest rate hike by the Federal Reserve (Fed) at its monetary policy meeting next week. The bitcoin price fell 1.12% to $19,934.65.
The Dow fell more than 400 points as investors feared the Fed’s accelerated rate hike could plunge the economy into a severe recession.
CME Group’s latest FedWatch tool shows that investors are 80% expect the Fed to raise rates by 0.75% to 3.00-3.25% at its September 20-21 meeting, and 20% expect the Fed to raise rates by 1.00%.
If the Fed raises rates by 0.75% in September, it will be the third time it has raised rates by 0.75%, having already raised 0.75% in June and July. And if the Fed raises rates by 1.00%, it would be the largest rate hike in 40 years.
In November 2021, bitcoin surpassed $69,000, its highest level in history, before collapsing below $20,000 in June 2022 amid fears that the Federal Reserve’s accelerated rate hikes and balance sheet reductions would strain market liquidity and lead to a recession in the U.S. economy.
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Saturday, September 17, 2022