Bitcoin Price Remains Lower After Release of FOMC Minutes

The Federal Reserve raised its benchmark fed funds rate by 25 basis points at its most recent meeting.

AccessTimeIconFeb 22, 2023 at 8:19 p.m. UTC
Updated May 9, 2023 at 4:08 a.m. UTC
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The minutes from the Jan. 31-Feb. 1 meeting of the Federal Reserve's Federal Open Market Committee (FOMC) suggested both hawkish and dovish sentiments among the participants, but notably missing was any discussion of a pause in the U.S. central bank's rate hike cycle.

"Almost all participants observed that slowing the pace of rate increases at the current juncture would allow for appropriate risk management," according to the minutes of the meeting, at which the Fed hiked the fed funds rate by 25 basis points, a slowdown from the 50- and 75-basis points hikes that became the norm through much of 2022.

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  • For the doves, some participants noted a softening in the growth in consumer demand. On the hawkish side, though, some at the meeting said some measures of financial conditions had eased over the past few months – perhaps inconsistent with the degree of policy restraint necessary to bring inflation back to its 2% target.

    Bitcoin (BTC) was down more than 3% for the day at around $23,800 prior to the news release, and currently remains around that level.

    Bloomberg's David Wilcox found only one mention of the word "pause" in the minutes and that was in reference to other central banks. This is somewhat notable as markets as recently as three weeks ago had priced in a pause in the Fed's rate hikes in May (after one more 25 basis point rate hike in March). After a raft of strong economic data and a number of hawkish Fed speakers, markets now anticipate not just another 25 basis point hike in May, but the chance of the central bank hiking by 50 basis points in March.

    That change in sentiment has helped push U.S. Treasury yields sharply higher, with the 10-year Treasury yield at more than a three-month high of 3.92% and the two-year yield to more than a 15-year high of 4.70%. Also, bitcoin has been unable to continue its bullish 2023 run, falling back from the $25,000 level three times over the past week.

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    Stephen  Alpher

    Stephen Alpher is CoinDesk's managing editor for Markets. He holds BTC above CoinDesk’s disclosure threshold of $1,000.


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