Simply put
- The altcoins experienced volatility, leading Bitcoin to drop below $95,000.
- This week, the Federal Reserve is likely to maintain interest rates.
- The President recently increased tariffs on foreign films.
Bitcoin’s price plummeted below $95,000 on Monday after President Trump hinted at new tariffs just before the Federal Reserve’s interest rate decision.
As reported by a data provider, Bitcoin traded around $94,000, reflecting a 1.8% decrease in the last 24 hours. It started the weekend above $96,000.
Many altcoins faced even steeper declines, with XRP dropping 2.7% to $2.12 and Solana decreasing by 0.8% to around $146.
The Fed is anticipated to hold benchmark interest rates steady on Wednesday, with traders viewing a 97% probability that the central bank will stick to its target range of 4.25% to 4.5% for a third consecutive time.
Trump has repeatedly voiced his views on economic stability, with Fed Chair Jerome Powell indicating that the central bank aims to keep interest rates stable while observing how White House efforts on trade might impact the economy and inflation.
Juan Leon, a senior investment strategist at Bitwise, noted that Powell’s comments suggest a cautious approach towards stimulating the economy by lowering borrowing costs, hinting at trade tensions potentially influencing monetary policy.
While Powell’s statements allow the Fed to remain flexible in response to trade developments, they also reflect a nuanced stance, apparently meant to avoid making definite predictions about the economic trajectory.
“I think they’re trying to keep things close to the chest,” Leon remarked, commenting on the Fed’s approach.
On Wednesday, the Fed will unveil its quarterly economic forecasts, indicating individual committee members’ predictions for interest rate adjustments by the year’s end. Back in December, forecasts anticipated two quarter-point rate cuts.
Cryptocurrencies have generally risen alongside stocks in recent weeks, particularly as Trump eased his harsh rhetoric on tariffs, but new statements this weekend introduced uncertainty.
On Sunday, Trump tweeted about a plan to enact 100% tariffs on foreign films to protect the struggling American film industry.
