August’s Consumer Price Index (CPI) came in line with market expectations, giving the US Federal Reserve the final green light to cut its target rate at next week’s FOMC meeting.
In fact, with the labour market rapidly deteriorating, there is a growing speculation about whether the Fed will proceed with a more aggressive 50 basis point rate cut.
Prominent analyst and Into The Cryptoverse co-founder Benjamin Cowen believes it would be “reasonable” for the central bank to decide on a 50 bps cut, pointing to the rising unemployment rate, the spike in jobless claims, the weakening job-openings-to-workers ratio, and the fact that the 2-year yield is already 100 basis points below the Fed funds rate.
Notably, a 50 bps cut isn’t priced in, and would result in an explosive crypto market rally.
The Bitcoin price is already showing significant bullish strength, climbing to $114,600 following the CPI release. Despite the Rektember fears, BTC is now up by nearly 7% over the past week.
August CPI Shows Inflation Remains Elevated, But In Check
August’s Consumer Price Index was largely in line with market expectations.
The headline CPI rose 2.9% year-over-year, its highest level since January 2025. Meanwhile, core CPI, which excludes food and energy prices, climbed 3.1%.
Consumer prices increased by 0.4% in August, above the 0.2% forecast.
While inflation in the US economy remains elevated, this week’s CPI and PPI won’t deter the US Federal Reserve from cutting rates in August.
Will The Fed Cut Interest Rates By 50 BPS In Next Week’s FOMC?
Into The Cryptoverse’s Benjamin Cowen makes a strong case for a 50 bps cut in the Federal target rate at next week’s FOMC.
The unemployment rate has climbed up to 4.3%, its highest level since October 2021. Meanwhile, the US labour market is rapidly deteriorating. Even this week’s jobless claims data came out at 263k, much higher than the expected 236k and the highest in over 4 years.
Cowen argues that even with a 50 bps cut, the Federal funds rate would remain restrictive, since it would still sit well above the 2-year yield.
The biggest argument for an aggressive cut is the massive downward revisions in jobs data: June payrolls, initially reported at 144,000, were later cut to 14,000 and ultimately revised to a loss of 13,000. On top of that, the annual benchmark revision reduced job growth over the past year by another 911,000.
A strong case can be made that the Fed would have already cut rates if it had seen the revised data earlier. To make up for lost time, a 50 bps cut now appears justified.
As previously mentioned, a 50-basis-point easing isn’t priced in, and would result in an explosive market rally.
Bitcoin Price Hits $114,600, Experts Call HYPER The Next 10x Crypto
Despite Rektember fears, the Bitcoin price has climbed up by nearly 7% to trade as high as $114,600 on Wednesday.
With a daily close above $113,000 on Tuesday, BTC is poised for a rally to $118,000 and subsequently to new all-time highs.
Notably, the bulls remain confident that Bitcoin will hit $150,000, and a bullish divergence in the weekly timeframe confirms their thesis.
Meanwhile, low-cap hunters have identified Bitcoin Hyper (HYPER) as a beta bet on BTC.
Bitcoin Hyper is the newest BTC layer-2 project, which aims to use zero-knowledge architecture and Solana Virtual Machine to tackle the slow transaction speed and high fees on Bitcoin.
It aims to bring the scalability, performance and programmability of modern blockchains to Bitcoin, paving the way for payment apps, DeFi apps and even meme coins.
HYPER has emerged as one of the hottest presale coins on the market. Behind a string of six-figure investments from whales, it has now raised over $15 million in its ICO.
Considering it is a beta bet on BTC, which is expected to reach $150,000 this year, many analysts anticipate that Bitcoin Hyper will be the next 10x crypto.
Visit Bitcoin Hyper Presale
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