Japan Hikes Interest Rates for the Third Time – How Did Crypto React?
24.01.2025 11:41 2 min. read Alexander Stefanov
Japan's central bank has made a bold move, increasing its benchmark lending rate to 0.5% - a level not seen since 2008.
This long-anticipated hike is stirring unease among global markets, with ripple effects reaching the cryptocurrency sector.
The Bank of Japan’s third rate hike in under a year reflects its effort to address persistent inflation, expected to stay above 2.6% through 2025. However, this policy shift comes at a cost, as Japan’s growth outlook has been downgraded. A stronger yen could upend the carry trade, a strategy where investors borrow yen to invest in higher-yielding markets, potentially disrupting global liquidity.
Bitcoin and other cryptocurrencies like Ethereum and Solana quickly reacted to the news, with Bitcoin dropping 3% before rebounding.Now, BTC is up around 3.5% in the pasr 24 hours. Analysts suggest this volatility is tied not only to Japan’s rate hike but also to uncertainties stemming from U.S. policies on digital assets.
While some analysts warn that Bitcoin could face a steep decline, comparing current trends to historical market crashes, others see a chance for long-term gains. The potential for a significant sell-off has raised concerns, but a segment of the market remains optimistic, viewing the volatility as an opportunity to accumulate assets at lower prices.
The rate hike adds another layer of complexity to an already uncertain global environment. As Japan adjusts its monetary stance, geopolitical tensions and U.S. trade policies are further shaking investor confidence. Despite the turbulence, history suggests that market recoveries often follow these brief periods of sell-offs, offering strategic opportunities for the patient investor.
By adapting to these shifts, traders can position themselves to benefit from any eventual stabilization, provided they maintain a long-term perspective.
-
1
U.S. Imposes New Tariffs as Trade Dispute with Canada Escalates
12.03.2025 9:00 1 min. read -
2
Cathie Wood Sees Recession Risks, Predicts Policy Shift
19.03.2025 11:00 1 min. read -
3
Federal Reserve Holds Rates Steady as Economic Uncertainty Mounts
19.03.2025 20:03 1 min. read -
4
U.S. Senate’s Approval of Funding Bill Creates Tension Among Democrats
16.03.2025 15:00 2 min. read -
5
Fed Signals Rate Cuts, but Market Uncertainty Persists
24.03.2025 10:00 2 min. read
Trump Implements Global Tariff Plan, Triggering Bitcoin Price Drop
In a recent live address, U.S. President Donald Trump declared that a new base tariff of 10% would be applied universally to all countries.
Global Economic Pressures Mount as U.S. Trade Policies and Inflation Concerns Persist
Consumer spending in the U.S. showed weaker-than-expected growth in February, increasing only 0.1%, which was on the lower end of economists’ forecasts.
US PCE Inflation Holds Steady at 2.5% in February, Core Index Surpasses Expectations
In February, the U.S. maintained its annual inflation rate at 2.5%, as reflected in the Personal Consumption Expenditures (PCE) Price Index, according to data released by the Bureau of Economic Analysis.
Stagflation Fears Loom, Yet UBS Identifies Key Investment Areas
UBS has issued a stark warning to investors, flagging stagflation as a looming economic threat.
-
1
U.S. Imposes New Tariffs as Trade Dispute with Canada Escalates
12.03.2025 9:00 1 min. read -
2
Cathie Wood Sees Recession Risks, Predicts Policy Shift
19.03.2025 11:00 1 min. read -
3
Federal Reserve Holds Rates Steady as Economic Uncertainty Mounts
19.03.2025 20:03 1 min. read -
4
U.S. Senate’s Approval of Funding Bill Creates Tension Among Democrats
16.03.2025 15:00 2 min. read -
5
Fed Signals Rate Cuts, but Market Uncertainty Persists
24.03.2025 10:00 2 min. read
