Will the Bitcoin Rally Continue Amid Rising Fed Rate Cut Odds?
Summary
The probability of the Federal Reserve cutting interest rates on September 18 has risen sharply, with a 63% chance of a 50 basis point cut. This expectation has significantly contributed to Bitcoin’s recent price upward trend, which experienced a correction to $58,560 after briefly exceeding $60,000. Analysts suggest that continued favorable conditions may support further rallying of Bitcoin this year.
Recent data from the CME FEDWATCH, reported by Bloomberg terminal via the X platform, indicates that the probability of a significant interest rate cut by the Federal Reserve has increased substantially. As of September 18, the Federal Open Market Committee (FOMC) is scheduled to convene, during which it is anticipated that a decision regarding interest rates will be made. Currently, there is a 63% likelihood of a 50 basis point reduction and a 37% chance of a 25 basis point cut. The anticipated cuts have been primary catalysts for the recent upward trajectory of Bitcoin prices, with the cryptocurrency successfully breaching the $60,000 mark last week after a nearly 5% increase. However, in the past 24 hours, Bitcoin has experienced a correction, seeing a decline of 3.22%, which brings its value down to approximately $58,560 at the time of this report. Analysts are optimistic that should the Federal Reserve follow through with the expected interest rate cut, it may propel Bitcoin further upward this year, contingent upon the alignment of other bullish factors.
Understanding the implications of Federal Reserve interest rate decisions is crucial for the cryptocurrency market, particularly Bitcoin. Interest rates significantly influence investor behavior and market liquidity, which can lead to price volatility in cryptocurrencies. In recent months, anticipated cuts in interest rates have been linked to Bitcoin’s price surges, reflecting a broader trend where lower rates often drive investors toward alternative assets in search of higher returns. As such, the forthcoming FOMC meeting may be of great importance to Bitcoin investors and market analysts alike.
In summary, the Federal Reserve’s potential decision to lower interest rates in their upcoming meeting could greatly impact Bitcoin’s market performance. The anticipation of a significant rate cut has already demonstrated its influence on the cryptocurrency’s value, and further declines in rates may sustain or even enhance Bitcoin’s upward momentum. Investors and analysts will be closely monitoring the developments from the FOMC meeting in anticipation of how it may shape the cryptocurrency landscape.
Original Source: www.investing.com
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