- Federal Reserve signals two rate cuts in 2025.
- Impact on BTC and ETH markets.
- Potential macroeconomic shifts anticipated.
Federal Reserve Chair Jerome Powell has indicated potential support for two rate cuts in 2025, each 25 basis points, at future FOMC meetings, emphasizing data dependence.
Such rate cuts could boost liquidity, affecting cryptocurrency markets, potentially leading to increased institutional investment and asset appreciation.
The Federal Reserve has hinted at supporting two additional rate cuts in 2025, each of 25 basis points. This potential policy shift was highlighted in the Federal Open Market Committee's official statement.
Federal Reserve Chair Jerome Powell, along with the FOMC members, indicated a potential path for rate adjustments, citing evolving economic conditions. However, any move is conditional and not guaranteed. "In considering additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks,” stated Jerome H. Powell, Chair of the Federal Reserve.
Lower interest rates typically increase liquidity and have led to rising interest in cryptocurrencies such as Bitcoin and Ethereum. Market participants are observing these indicators closely for future gains.
The decision on whether to proceed with rate cuts is influenced by internal agreements within the FOMC. Stephen I. Miran opposed the suggested rate cut size, favoring a larger adjustment as per the FOMC Calendar of Meetings and Events for Monetary Policy.
Bitcoin and Ethereum are historically affected by changes in U.S. monetary policy. Decreased interest rates might enhance their attractiveness relative to USD-denominated assets.
Historical data indicate rate cuts can spur growth in crypto and DeFi sectors. In past cycles, liquidity boosts led to rallies in both crypto and risk assets like BTC and ETH.