Bitcoin slips to below $23,000 as the ECB is likely to deliver its first rate hike in 11 years, as well as signal an exit from its negative interest rate policy. Reports godbole17
Bitcoin retreated to under $23,000, having printed a six-week high of $24,265 on Wednesday. Despite the pullback, prices were up 14% for the month, according to CoinDesk data.
The ECB rate decision due on Thursday at 12:15 GMT will be followed by the central bank's President Christine Lagarde's press conference at 12:45 GMT. The consensus is for the bank to raise the benchmark interest rates by 25 basis points to -0.25% from the current record low of -0.5%. The ECB, Bank of Japan , and Swiss National Bank have held rates below zero for years.
"I think that the underlying case for crypto assets becomes more apparent in times of significant economic and currency turmoil - an alternative system beholden to sentiment but not to any economic fundamentals, unlike equities or bonds," Noelle Acheson, head of market insights at Genesis Global, said."And investors have to do something, staying in cash in times of rising rates and volatile currencies is not a resilient strategy," Acheson added.
According to FXStreet, interest rate traders are pricing a 40% probability of a half-point rate hike on Thursday while factoring 97 basis points of tightening by September.Perhaps, battered risk assets may show resilience to rate hikes if the central bank announces an anti-fragmentation tool to ensure the impact of an increase in borrowing costs is felt the same way across the common currency area.
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