Bitcoin slides after U.S. central bank holds rates steady

The world’s largest cryptocurrency was last down 1% to $75,632.1

Bitcoin slid on Wednesday, after the U.S. central bank held interest rates steady and signalled that it was ready to continue to do so in order to fight any inflationary impact from the Middle East.

Another diplomatic setback between Iran and the U.S. also weighed on sentiment.

The world’s largest cryptocurrency was last down 1% to $75,632.1 by 21:08 GMT.

The Federal Open Market Committee (FOMC) kept its key policy rate steady at 3.50%-3.75%, as widely expected.

Notably, the decision saw the highest number of dissents since October 1992. One policymaker preferred a 25 basis point rate cut, while three policymakers did not support the inclusion of an easing bias in the FOMC’s statement “at this time.”

The central bank’s decision comes at a time when surging oil prices due to the Middle East war have made their impact felt on headline inflation in the U.S. More possible inflationary pain ahead, along with a labour market that remains in a “low hire, low fire” environment, has made the central bank’s job complicated.

U.S. central bank Chair Powell in his post-decision press conference said that policymakers were in a good place to move in either direction towards rate cuts or rate hikes depending on how the impact of surging oil prices due to the Iran war plays out.

Higher interest rates for longer usually weigh on risky assets such as cryptocurrencies.

The central bank Chair also said he would stay on as a Fed governor even after his term ends. His remark came on the same day the U.S. Senate Banking Committee voted to advance the bank Chair’s chosen successor, Kevin Warsh, to a full Senate vote, setting up Trump’s pick for a final confirmation.