- Federal Reserve hints at rate cut, impacting crypto markets.
- 80-95% likelihood of change seen in market predictions.
- BTC and ETH poised to benefit from increased liquidity.
The Federal Reserve, under Chair Jerome Powell, signals an 80–95% probability of an interest rate cut in September 2025 due to declining inflation and slowed job growth.
The anticipated rate cut could lead to lower borrowing costs, affecting equities, commodities, and potentially enhancing cryptocurrency market performance by increasing liquidity and risk appetite.
The recent surge in odds for a Federal Reserve interest rate cut in September 2025 is notable, with predictions reaching 80–95%. This move reflects cooling inflation, slowing job growth, and revised GDP forecasts.
Under Chair Jerome Powell, remarks highlight potential policy adjustments. Powell stated, “Inflation had moved much closer to our objective, and the labor market had cooled from its formerly overheated state.” Key changes hinge on economic indicators and regulatory shifts.
The expected rate cut could significantly influence borrowing costs and global markets. A reduction in rates often leads to lower borrowing costs, inversely affecting currency valuations and boosting risk assets, including cryptocurrencies and equities.
Cryptocurrencies like BTC and ETH stand to gain from this anticipated monetary easing. Historical trends indicate positive reactions in the crypto sector to dovish stances, which bolster liquidity and increase risk-taking behavior among investors.
Market anticipations of rate adjustments have been reinforced by futures trading platforms, signaling a strong belief in upcoming changes. This aligns with economic indicators showing diminished inflation risks, as noted by Powell.
The potential financial, regulatory, and technological outcomes of such monetary policy shifts are considerable. Increased liquidity could spur growth in DeFi protocols like Curve and Lido Finance, reflecting historical trends post-dovish pivots in 2019 and 2020.
