Goldman Sachs Predicts Multiple Federal Reserve Rate Cuts in 2025

Goldman Sachs forecasts that the Federal Reserve may implement three rate cuts in 2025, starting as early as July, based on economic research assessments.

This outlook may significantly impact financial and crypto markets, suggesting potential flows into riskier assets if lower interest rates are realized.

Goldman Sachs Forecasts Three Rate Cuts in 2025

Goldman Sachs’ economic research team anticipates the Federal Reserve will introduce three rate cuts in 2025. The most likely periods for these adjustments are July, September, and December. Fed Governor Christopher Waller indicated alignment with this timeline, suggesting potential action by July based on economic indicators. “I think we’re in a position that we could do this as early as July. That would be my view, whether the committee would go along with it or not.” – CNBC Jerome Powell remains cautious about initiating rate cuts, citing the need for further evidence on inflation trends and labor market conditions.

Should interest rate reductions occur, expectations are for weaker immediate impacts on bond yields and broader investment markets. Fed rate cuts could stimulate equities and possibly enhance cryptocurrency investments, as investors seek advantageous positions in growth-oriented sectors.

Community and institutional feedback varies, with Morgan Stanley analysts less optimistic about imminent rate changes. Despite diverging market interpretations, discourse highlights ongoing assessments of employment data and macroeconomic factors.

Cryptocurrency Markets Eye Opportunity in Rate Cut Scenarios

Did you know? Goldman Sachs offered similar dovish predictions in 2019, aligning with historical precedents that saw crypto inflows rise during Fed easing cycles.

According to CoinMarketCap, Bitcoin’s current price stands at $107,509.17, with a market capitalization of $2,137,905,441,616. Bitcoin has shown recent growth trends, with a 26.62% increase over 90 days and varied short-term movements. The asset maintains a market dominance of 64.42%, supported by a circulating supply of 19,885,796 coins.

Expert insights suggest potential impacts of rate cuts include advancing opportunities for crypto and DeFi sectors. Historically, decreased rates have driven investments toward alternative assets and increased on-chain activities, echoing past patterns seen in prior easing cycles. XRP and other cryptocurrencies could benefit from changed market dynamics as investors look for viable alternatives in a low-interest environment.