FOMC Expected to Approve December Rate Cut
- Federal Reserve expected to cut rates again.
- Jerome Powell, key decision-maker.
- Crypto markets may react positively to change.
The Federal Reserve’s FOMC may decide on a rate cut on December 10, following the October reduction to 3.75-4.00%, aiming to adjust economic conditions.
Potential adjustments can influence cryptocurrency markets, with Bitcoin and Ethereum being particularly sensitive to changes in macro-economic liquidity, depending on FOMC’s forthcoming decisions.
The Federal Open Market Committee (FOMC) anticipates a rate cut on December 10. This follows the October 29 decision where the Fed reduced the federal funds target range to 3.75–4.00% amid a shift in risks.
Jerome H. Powell, Chair of the Federal Reserve, leads this decision, with key figures like Philip N. Jefferson. The move continues their strategy of data-dependence, highlighted in recent policy statements. According to Raoul Pal, CEO, Real Vision, “With the Fed cutting rates, we can expect more liquidity in the system, which historically has favored Bitcoin and Ethereum.”
The anticipated rate cut could affect financial markets, particularly risk assets like cryptocurrencies. Historically, such adjustments lead to increased liquidity, potentially benefiting sectors sensitive to macroeconomic policies.
Lower interest rates generally reduce funding costs, promoting economic activity. This scenario may encourage investment in high-risk industries such as crypto, providing potential upward momentum for digital currencies and related financial instruments.
Federal Reserve actions influence global financial systems, steering economic trajectories. Speculation around rate changes affects investor sentiment, often impacting markets before official announcements.
Historical trends suggest that macro easing cycles stimulate interest in speculative assets. Cryptocurrencies like Bitcoin and Ethereum usually experience growth in such periods, driven by improved liquidity conditions and reduced borrowing costs.
