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Breaking: US Fed Officials Favor To Hike Rates Over 6%, Is Bitcoin Crash Imminent?

US Federal Reserve officials favor raising interest rates over 6% to curb inflation despite the US debt ceiling crisis.
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Breaking: US Fed Officials Favor To Hike Rates Over 6%, Is Bitcoin Crash Imminent?

Federal Reserve Bank of Minneapolis President Neel Kashkari and Federal Reserve Bank of St. Louis President James Bullard joined other US Fed officials to consider more rate hikes despite the catastrophic debt ceiling crisis. In fact, the debt ceiling deal will impact the BTC price as the US Treasury will issue government bonds to recover lost balance during the banking crisis.

Inflation and a tight job market may push US Federal Reserve to continue hiking rates. Fed Chair Jerome Powell’s speech last week failed to give a clear direction. Moreover, Dallas Fed President Lorie Logan, Fed Governor Philip Jefferson, New York Fed President John Williams, Federal Reserve Board Governor Michelle Bowman, and others agree with raising interest rates further.

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US Fed to Likely Raise Interest Rates Over 6%

Federal Reserve Bank of St. Louis President James Bullard on May 22 said the central bank will need to raise interest rates twice this year before a pivot. The Federal Open Market Committee has raised rates aggressively to a range of 5% to 5.25%.

Meanwhile, Minneapolis Fed President Neel Kashkari also believes raising interest rates over 6% to curb inflation. He said even if Fed skip the rate hike in June, it shouldn’t be considered as a pause or a pivot as inflation has not reached the target.

“I think right now it’s a close call, either way, versus raising another time in June or skipping. What’s important to me is not signaling that we’re done.”

CME FedWatch tool indicates a 76% probability of pausing rate hike in June, a drop from 81% a day ago. Moreover, the US dollar index (DXY) continues to move higher, causing a rise in selling pressure on Bitcoin price.

Also Read: Peter Brandt Predicts Bitcoin Price Fall Below $25K In May

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BTC Price To Break Below $25K

BTC price continues to trade sideways for a week, with the price currently trading near $26,800. The 24-hour low and high are $26,415 and $27,466, respectively. Whales and miners are selling their BTC holdings in anticipation of fall in BTC price due to macro.

Veteran trader Peter Brandt predicts Bitcoin price can break below the $26,800 level and fall to $24,800. After the correction, Bitcoin price will continue to move higher. Meanwhile, he remains bullish on a BTC price hitting $40,000.

Also Read: Smart Money More Inclined To Invest In Ethereum Over Bitcoin: Bloomberg

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Varinder Singh

Varinder has over 10 years of experience and is known as a seasoned leader for his involvement in the fintech sector. With over 5 years dedicated to blockchain, crypto, and Web3 developments, he has experienced two Bitcoin halving events making him key opinion leader in the space. At CoinGape Media, Varinder leads the editorial decisions, spearheading the news team to cover latest updates, markets trends and developments within the crypto industry. The company was recognized as Best Crypto Media Company 2024 for high impact and quality reporting. Being a Master of Technology degree holder, analytics thinker, technology enthusiast, Varinder has shared his knowledge of disruptive technologies in over 5000+ news, articles, and papers.

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Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
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