FOMC Rate Hike Sparks Short Covering in XRP

XRP's price has recovered to around $1.30 after a sharp decline earlier in the week, as traders monitor short covering and the Federal Reserve's latest rate decision.

The XRP price move comes after the September 16 FOMC meeting, where the Federal Reserve raised its benchmark interest rate by 25 basis points to a target range of 3.75%-4.00%, marking the first U.S. rate increase since 2023 and adding uncertainty for cryptocurrencies.

Crypto analyst @CW8900 highlighted a shift in XRP perpetual futures positioning, reporting that short positions built ahead of the FOMC meeting were being closed. Short covering occurs when traders repurchase an asset to exit bearish positions, which can provide additional upward pressure.