Traders Anticipate Fed Rate Cut in September After Economic Data

Traders anticipate a Federal Reserve interest rate cut in September, following US economic data and statements by Chair Jerome Powell noting labor market risks amidst ongoing inflation.

Such a cut could impact crypto markets, historically benefiting assets like Bitcoin and Ethereum due to improved liquidity and a weaker dollar.

Powell Signals Possible September Rate Cut Amid Market Adjustments

Federal Reserve Chair Jerome Powell’s remarks suggest potential for a September interest rate cut. He cited labor market risks despite inflation concerns. Both Michelle Bowman and Christopher Waller dissented previously, favoring rate cuts.

Interest rate futures indicate growing anticipation of a cut. Financial markets, including bond yields and the US dollar, are adjusting to these expectations. Market participants forecast a 75–85% likelihood of a rate cut in September.

“The door is open to a September rate cut, citing rising risks to the labor market even as inflation pressures linger.” – Jerome Powell, Chair, Federal Reserve

Bitcoin Reaction Tied to Historical Fed Policy Shifts

Did you know? In 2019 and 2020, Federal Reserve rate cuts provided favorable conditions for crypto markets, with BTC and ETH showing strong performance during these periods.

According to CoinMarketCap, Bitcoin (BTC) currently trades at $110,655.25 with a market cap of formatNumber(2203503464065.06). The 24-hour trading volume is formatNumber(65578358733.82), showing a 1.86% change, and BTC’s market dominance stands at 57.49%.

The Coincu research team anticipates potential implications on both financial and crypto markets. Historical trends and recent data suggest increased volatility and possible bullish activity in cryptocurrencies following a shift in Federal Reserve policy.