The financial environment in Europe, this week, was the scene of a movement that echoed even in the world of cryptocurrencies. Bitcoin, known by many as the main cryptocurrency, recorded a jump to US$26,850 following a relevant announcement from the European Central Bank (ECB). The institution signaled that its recent increase in its main interest rate, the tenth in a row, could possibly be the last in that sequence.
Thursday, September 14, 2023, at the time of publication, the price of Bitcoin (BTC) was quoted at US$26,600.00, up almost 2% in the last 24 hours.
Likewise, most major altcoins are eyeing a positive breakout. ETH is approaching the $1,650 resistance zone, XRP is attempting a rally to the $0.50 level, and ADA is consolidating above $0.25.
In the official statement released by the ECB, it was mentioned that current interest rates have the potential to favor inflation, bringing it back to the stipulated objective. This was supported by the increase of three ECB policy rates by 0.25%. The bank’s main deposit rate, following this decision, is now at 4%, a considerable jump, especially when you remember that in June 2022, this rate was at -0.5%.
Furthermore, the ECB revised its inflation expectations, now anticipating an average of 5.6% in 2023, before stabilizing at 3.2% in 2024. This revision is in response to the projected trajectory for energy prices. It is worth noting that inflationary pressures remain high, but are showing signs of easing.
The economic context is changing. The ECB, for its part, predicts slower economic growth for the eurozone, pointing to a slowdown to 0.7% this year and a projection of 1.0% in 2024. These central bank decisions and forecasts, including The ECB and the Federal Reserve influenced the behavior of investors, who, last year, retracted their investments in risky assets, such as shares and cryptocurrencies.
In this scenario, Bitcoin experienced moments of prominence. In March 2023, for example, following the Federal Reserve’s implementation of the Bank Term Financing Program (BTFP), the cryptocurrency briefly surpassed the $30,000 mark.
Bitcoin chart today
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