Replays · FOMC · 16 Mar 2022, 18:00 UK
Down for half an hour, up for the rest of the night
The Fed's first rate rise in more than three years was fully expected. What markets were watching was how many more were coming. The answer, a projected six more increases in 2022, was taken badly at first. Within two hours, though, crypto and stocks had both reversed. Bitcoin's first hour ranks #21 of 80 Fed decisions in our data, but the hour alone misses the shape of the evening.
- Decision
- +0.25 points to 0.25% to 0.50%
- First hike since
- December 2018
- Dissent
- James Bullard, who wanted 0.5 points
- Time
- 18:00 UK
- Bitcoin at release
- $40,429
- Low
- about 2.7% down, at 18:30 UK
- High
- about 2.6% up, at 20:10 UK
The decision
The Fed's statement said it expected further increases to be appropriate and would soon begin shrinking its balance sheet. It also mentioned Russia's invasion of Ukraine, saying it was likely to add to inflation. One official, St. Louis Fed President James Bullard, voted against, saying a half-point hike would have been better.
Crypto and tech, in step
- 1 18:30 UK: the low, as Powell begins speaking
- 2 20:10 UK: Bitcoin's high for the evening
Bitcoin dropped 1.1% on the first candle, and the Nasdaq 100 ETF fell 1.6% in fifteen minutes. Both kept falling until about 18:30 UK, when the press conference began. Then they turned together. By the end of the hour, the Nasdaq 100 ETF was almost back to its starting level. Bitcoin was -1.2% at the hour mark and +1.1% at two hours.
Powell said the US economy was very strong and well placed to handle tighter policy. Stocks rallied into the 20:00 UK close, and the Nasdaq 100 ETF was +1.6% at that point.
The shape matters for anyone using our tables. A first-hour figure of -1.2% looks like a mildly negative reaction, but the evening as a whole was positive. Measured from the 18:30 UK low to the 20:10 UK high, Bitcoin rose more than 5%. Looking at the two-hour and four-hour columns tells a more complete story.
After the night
| Market | 1h | 4h | 24h | 1w | × normal hour |
|---|---|---|---|---|---|
| Bitcoin | −1.17% | +1.62% | +0.98% | +4.34% | 2.7× |
| Ethereum | −1.15% | +2.28% | +3.90% | +9.47% | 2.1× |
| Litecoin | −0.66% | +1.18% | +2.77% | +11.07% | 1.1× |
| Chainlink | −0.28% | +3.41% | +3.19% | +11.07% | 0.4× |
| XRP | −0.06% | +1.80% | +2.85% | +7.76% | 0.1× |
| Cardano | −0.55% | +1.37% | +3.31% | +31.87% | 1.0× |
Change from 18:00 UK.
Every coin in the table was higher four hours later, and most were higher after a week. Cardano stood out with a 32% gain over the week. In late March 2022, crypto had a brief rally, and Bitcoin climbed back above $47,000 by the end of the month before the long fall that followed.
Sources: release time and figures from the Federal Reserve's statement and target range (FRED DFEDTARU). Crypto: Bitstamp 5-minute candles; SPY/QQQ: IEX. No consensus forecasts are shown because they are proprietary; comparisons are with the previous release. “× normal hour” compares the first-hour move with the median move in matched quiet hours. How we measure it.