- Bitcoin dips below $114,000 as rate cut rumors linger.
- Altcoins like Ether, XRP, and Cardano show slight declines.
- Crypto market reacts cautiously to uncertainty around Fed’s decisions.
According to crypto analyst Crypto Rover, the probability of the Federal Reserve cutting rates in September has skyrocketed to 92%. This surge in expectations stems from weakening economic indicators, particularly in the labor market, and dovish signals from key Fed officials.
Tools like CME FedWatch and Polymarket have picked up on the rising likelihood of a rate cut, offering further support for the anticipated move.
Some major financial institutions, such as Goldman Sachs, have adjusted their expectations and are forecasting that the Fed will cut interest rates three interventions in 2008, with one cut in September.
These expectations imply that there is widespread optimism in the markets, with the probability of a rate cut increasing significantly, which will bring more liquidity to more risky assets such as cryptocurrencies.
Also Read: Ripple CLO Writes Open Letter to U.S. Senate Banking Committee on Request for Information
Fed’s Dissenting Views on Rate Cuts
However, not all analysts share the same optimism. Bank of America has expressed caution, warning that persistent inflation and a resilient labor market could keep the Fed from making a move until 2026.
Nonetheless, there are voices in the Fed, such as Waller and Bowman, who urge a cut in the rate that could crack the central bank’s strategy in the future.
Recently, the Federal Reserve Chair, Jerome Powell, affirmed plans to adopt a wait-and-watch strategy as the current worldwide conflicts and risks of inflation prompted by tariffs are discussed. This position discouraged the anticipation of a rate cut.
However, the divergence of opinions among Fed officials continues to confuse the market about what will happen next.
Crypto Market Faces Slight Dip Amid Rate Cut Rumors
The crypto market experienced a slight dip today as Bitcoin dropped below the $114,000 mark despite ongoing rumors of a potential rate cut by the Federal Reserve. Altcoins such as Ether, XRP, and Cardano had minor decreases, but their trend remained upward.
Market rallies initially occurred due to the expectation that the central bank would cut its policy rates, but now people are scared because they do not know when the rate cut will be made.
Investors are closely watching the Fed’s actions, knowing that any delay or change in rate-cut plans could shift market sentiment and reverse the recent gains.
Also Read: Crypto Crash: Bitcoin (BTC), Ethereum (ETH), XRP (XRP), and More Plunge-Here’s What’s Happening!
