Attempting to fight the raging inflation, the Bank of England raised the interest rates by 50 basis points today.
BTC’s price remained stable, without any significant volatility, unlike what happened yesterday when the Fed did the same.
- The inflation rates in many countries skyrocketed in the past several months, and the UK is no exception. The percentage there neared 10% for the month of August – levels not seen in several decades.
- The central bank – the Bank of England – has used primarily one tool to try to battle the galloping inflation – increasing interest rates.
- The latest hike came earlier today as the institution raised the key interest rate by another half a percentage to 2.25%. Although this is slightly below most expectations, the current level is the highest it has been since the 2008 crisis.
- Yesterday, the US Federal Reserve did something similar, but the interest rate hike there was 75 basis points. That had a profound effect on BTC’s price as the asset’s volatility brought it down to a new three-month low.
- The BOE’s action didn’t impact the primary cryptocurrency, at least for now, as it stands calm at around $19,000.
- Interestingly, when the European Central Bank increased its key interest rates, BTC remained stable as well. So far, it seems only the Fed’s action lead to enhanced volatility.