Bitcoin rebounded quickly after the Federal Reserve raised interest rates by 25 basis points on September 16, marking the first hike in over three years. The move, approved unanimously by policymakers, initially caused BTC to dip but the cryptocurrency recovered losses and moved into positive territory as the week progressed.
The rate increase was widely anticipated, with markets assigning the hike roughly a 90% probability before the Fed's announcement. This high degree of certainty likely limited the market shock when the decision became official.
Regulatory developments proved more disruptive to bitcoin's price than monetary policy. The US Senate's failure to pass the CLARITY Act on September 15 pushed BTC to a multi-week low of $75,000. Spot bitcoin ETFs recorded approximately $450 million in net outflows on September 15 and $296 million on September 16, indicating the regulatory setback had a more profound impact than the Fed's rate decision.
Research analysts noted that bitcoin held better than higher-beta assets like ETH and SOL following the rate hike. Bitcoin's growing correlation with gold and weakening relationship with Nasdaq suggest investors increasingly view it through a monetary and fiscal lens rather than as a leveraged technology trade.
Looking ahead, Treasury yields and macroeconomic indicators may prove more significant than the Fed meeting itself. The 10-year yield recently jumped past 5%, making government debt competitive with risk assets like bitcoin. Analysts see inflation, employment data, and Treasury yield movements as key factors for bitcoin's price direction going forward.
