The chaps at the Federal Open Market Committee, or FOMC as they’re known in the rather stuffy corridors of power, aren’t even due to gather for a chinwag for a month yet, but already the air is thick with speculation. And, naturally, the crypto market is all of a flutter, like a startled flock of pigeons. Everyone’s laying wagers – not terribly sporting, if you ask me – on what the outcome will be, with the general consensus edging towards a bit of a rate trimming. A notion our old friend, former President Trump, has been rather enthusiastically advocating for some time now. One does wonder if he’s got a tipster in the Federal Reserve.
September FOMC Meeting Votes Heat Up
The last FOMC palaver saw a distinctly agreeable turn of events, with the Fed deciding against piling on the pressure with higher interest rates. No cuts, mind you – a chap can’t have everything – but keeping things as they were managed to keep the markets on an even keel, resulting in a rather tolerable degree of jiggling in the riskier sectors, like Bitcoin and its crypto companions.
Now, the next shindig is scheduled for September 17th, and the betting is positively frantic. According to the FedWatch Tool, a contraption devised by the CME Group – sounds frightfully complicated, doesn’t it? – the majority believe the Fed will actually cave and slice those interest rates. It’s all a bit dramatic, really.
They reckon there’s a 92.2% chance they’ll actually *do* it, sending rates tumbling towards the 4% mark. A mere 7.8% fancy the Fed holding firm, and a vanishingly small 0% anticipate a rate hike. Honestly, the latter seems about as likely as a teetotaler enjoying a night at the Drones Club.
At present, rates are hovering between 4.25% and 4.5% – not the highest they’ve been, blessedly, but still a tad on the bracing side for those of us who dabble in the more speculative investments. This has resulted in a distinct lack of enthusiasm from the investor blighters, who are choosing to err on the side of caution. Perfectly understandable, of course. One mustn’t be a fool.
What A Cut Means For Bitcoin And Crypto
Historically, a rate reduction is rather jolly for assets deemed ‘risky’ – and Bitcoin and the crypto market certainly fall into that category. It tends to give them a rather useful boost. This is because such announcements stir things up, and the extra funds sloshing about as a result tend to send Bitcoin prices skyward.
The extent of the ascent, however, hinges on *how much* the Fed decides to cut. Take the COVID-19 lockdown of 2020, for instance. A truly dramatic chop from 1.58% to 0.05% unleashed the most spectacular bull run Bitcoin and crypto have ever witnessed! Quite the spectacle, though I daresay some lost a pretty penny along the way.
Therefore, a Fed rate cut would be rattling good news for Bitcoin. In fact, depending on the size of the slice, it could unleash a torrent of volatility and propel the digital asset to heights hitherto undreamt of. Though, let’s not get carried away. One shouldn’t count one’s chickens, and all that. 🐔
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2025-08-07 10:14