Fed Hikes Interest Rates By 25 Points, Prompting Bitcoin Volatility

Despite fears surrounding the US banking sector, the Fed has followed through on its plans to quell inflation with an interest rate hike of 25 basis points on Wednesday.

The decision notably affected the price of Bitcoin, which pumped $300 within 5 minutes of the announcement.

Bitcoin started the day trading at $28,216, before rising to $28,417 ahead of FOMC. 
The asset then broke upwards to $28,752 following the interest rate decision. It trades for $28,480 at writing time. 
According to Coinglass, there were $19.64 million in liquidations within the past 1 hour following the announcement. 
The decision takes the Fed’s policy interest rate up to a range of 4.75% to 5%. 
CPI inflation in February clocked in at 6%, which the Fed seeks to bring back to its 2% target by keeping interest rates high. 
Former Richmond Fed President Jeffrey Lacker claimed on Tuesday that further rate hikes are a necessity to reach that goal, and that the economy still had room for further tightening. 
Markets had widely anticipated this month’s hike, though they had priced in a 16% likelihood of no rate hike occurring. 
Some believed the Federal Reserve might flinch in the face of numerous bank failures this month, partly induced by cratering bond prices spurred by rising rates. 
However, others contend that the Fed has enacted a de facto “pivot” through its Bank Term Funding Program, injecting billions of dollars back into the economy without technically using quantitative easing. 
“The Committee anticipates that some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time,” stated the central bank.