The upcoming FOMC meeting will likely have the biggest impact on Shiba Inu holders’ portfolios.
For starters, the meetings are held once every three weeks and one of the key highlights is the revision of the Federal Fund rate. The latter is the rate at which banks borrow from the Federal Reserve.
The Federal Reserve uses the Federal fund rate as a tool for balancing the economy. A lower rate means it is cheaper to borrow, making it easier for people to access liquidity and thus an easier investment environment.
On the other hand, a higher rate makes borrowing less appealing and discourages investment.
The Federal fund rate has been rising for the most part in 2022 as part of the FED’s quantitative tightening measures to curb inflation.
Shiba Inu and the rest of the market experienced a bullish surge after the last FOMC meeting. This is because the FED only increased interest rates by 0.5% or 50 basis points compared to 0.75% or 75 basis points in the previous month’s announcement.
(By Michael Nderitu)
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