Advances in Economics, Management and Political Sciences

- The Open Access Proceedings Series for Conferences


Proceedings of the 2nd International Conference on Financial Technology and Business Analysis

Series Vol. 58 , 20 November 2023


Open Access | Article

The Impact of Federal Reserve Increasing Interest Rate on ETH Market

Haolan Cheng * 1
1 China Agricultural University

* Author to whom correspondence should be addressed.

Advances in Economics, Management and Political Sciences, Vol. 58, 36-43
Published 20 November 2023. © 20 November 2023 The Author(s). Published by EWA Publishing
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Citation Haolan Cheng. The Impact of Federal Reserve Increasing Interest Rate on ETH Market. AEMPS (2023) Vol. 58: 36-43.

Abstract

On 16th March 2022, U.S. Federal Reserve increased the interest rate the first time, and in the whole year, U.S. Federal Reserve made seven increments on interest rate. As this will affect the value of dollar, many American financial assets were also affected by it, including ETH, one of the most famous cryptocurrencies. This paper uses the history data of ETH price from January 2018 to July 2023 and constructs ARIMA model without Federal Reserve increasing the interest rate to compare with the reality in order to comprehend how the increasing interest rate affected the price of ETH, and use the model to predict the trend of Ethereum’s price. With the influence of increasing interest rate, the price of Ethereum should decrease. However, after the U.S. Federal Reserve increased interest rate, the price of Ethereum went up for a while then dropped dramatically. And the reasons why this delay appears are the delay of policy and the first increment of interest rate is not attractive enough for investors to change their strategies. That can bring some inspirations to policymakers. They should acknowledge that there will be a delay in the market after the policy is released and they could give some potential signs or preferences on the new policy to reduce the shock to market. For investors, they could pay more attention on relevant policy and make use of the delay to make more money.

Keywords

U.S. federal reserve, interest rate, Ethereum

References

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Data Availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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Volume Title
Proceedings of the 2nd International Conference on Financial Technology and Business Analysis
ISBN (Print)
978-1-83558-207-7
ISBN (Online)
978-1-83558-208-4
Published Date
20 November 2023
Series
Advances in Economics, Management and Political Sciences
ISSN (Print)
2754-1169
ISSN (Online)
2754-1177
DOI
Copyright
20 November 2023
Open Access
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited

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