Replays · FOMC · 20 Mar 2024, 18:00 UK

A hold that sounded like relief

Nobody expected a rate change on 20 March 2024. The question was whether two hot inflation reports would make Fed officials cut their forecast of three rate cuts that year. They didn't, and crypto climbed for almost four hours.

Statement: Wednesday 20 March 2024, 18:00 UK
Decision: Hold at 5.25–5.50%
Projections: Median still showing three quarter-point cuts in 2024
Bitcoin at release: $64,115
Recent record: About $73,800 on 14 March, six days earlier

The backdrop

Bitcoin had set a record high on 14 March, then fallen about 13% by the time of the statement. The January and February inflation reports had both come in hot, and some in the market worried the Fed would scale back its projected cuts from three to two. The median projection stayed at three, putting the Fed funds rate at 4.6% by the end of 2024.

Four hours of buying

1 19:00 UK: up about 2%
2 21:25 UK: high, about 6% up

Bitcoin, 5-minute candles around the 18:00 UK statement, % from the release price.

The first half-hour was choppy, and at 18:35 UK Bitcoin was slightly below its release price. Then it kept rising. It was +2.06% after an hour, 4.8 times a normal hour and ranked #9 of 80 Fed decisions in our data. By four hours it was +5.7%, with the high at 21:25 UK.

Change four hours after the statement, %.

The shape matters too. There was no single jump on the statement. The climb came in steps through the press conference and into the evening, after US stocks had closed at 20:00 UK, with each hour adding to the last. Bitcoin was +2.6% at two hours and still rising. A slow climb like that suggests buyers arriving over time rather than a reaction to one headline.

Dogecoin and Solana

Every coin we track rose. Dogecoin led, +5.9% after an hour and +12.9% at four hours. Solana's first hour, +5.6%, was 9.3 times its normal hour. US stocks rose more gently: the Nasdaq 100 ETF was +0.8% after an hour and +1.1% at two hours, when the market closed.

Some of the gain faded the next day: Bitcoin was +2.5% at 24 hours. Dogecoin did not fade. It was +40% a week later, far ahead of Bitcoin's +7.1%. A Fed meeting can set the mood for an afternoon, but a 40% week in one coin needs its own explanation, and the Fed isn't it.

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.