Important points
There is a 96.9% chance that the Fed will cut interest rates by a quarter of a percentage point in December. Bitcoin has remained resilient amid monetary policy changes, maintaining trading levels above $100,000.
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The Federal Reserve is expected to cut interest rates by a quarter of a percentage point at its next meeting in December, bringing the benchmark interest rate to a range of 4.25% to 4.50%, Bloomberg reports.
This expected move is in line with market expectations, as shown by the CME FedWatch tool, which indicates a 96.9% chance of a rate cut.
If realized, it would be the first full percentage point decline since September and highlight the Fed's continued efforts to manage economic conditions.
Market forecasts predict fewer interest rate cuts next year as inflation persists and economic growth remains strong.
This outlook is supported by the core consumer price index, which rose 3.3% year-on-year and has continued to rise consistently since June.
In addition to this, labor market data reveals a reversal in the unemployment rate, with recent employment figures showing a notable recovery, further supporting the resilience of the economy.
These economic indicators, combined with inflationary pressures from President-elect Trump's proposed tariffs and tax cuts, have shifted the focus from jobs to inflation.
The Fed is expected to cut rates next week, but economists say the pace of rate cuts may slow in 2025, with only three expected cuts due to sustained inflation and strong economic growth. I am doing it.
Against this backdrop, Bitcoin has shown surprising strength.
Over the past few days, Bitcoin's performance has been supported by macroeconomic data such as CPI, non-farm payrolls, and unemployment rate, along with important developments in US leadership.
Federal Reserve Chairman Jerome Powell emphasized Bitcoin's growing prominence, describing it as a “competitor to gold.”
This momentum, coupled with President-elect Trump's nomination of Paul Atkins as SEC Chairman and David Sachs as Cryptocurrency Czar, further strengthens Bitcoin's potential strength heading into 2025.
News that the Fed could cut interest rates next week could also add to Bitcoin's resilience and support its strong performance in the short term.
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