- Big financial companies like Goldman Sachs now think the Fed will lower interest rates three times this year, starting in September
- Some, such as Bank of America, remain skeptical about rate cuts next month
- Not long ago, Fed Chair Jerome Powell reaffirmed a wait-and-see approach, but certain Fed officials, like Waller and Bowman, disagreed
A crypto analyst who goes by the name of Crypto Rover is predicting a market explosion, as the probability of a September rate cut by Jerome Powell has soared to 92%. The data is likely referenced from tools like CME FedWatch and Polymarket that suggest a high likelihood (approaching 92%) of a US rate cut next month, based on weakening jobs and dovish sentiment from Fed officials.
Big financial companies like Goldman Sachs now think the Fed will lower interest rates three times this year, starting in September. This has also made a rate cut much more probable, with the chances rising.
Interestingly, some, such as Bank of America, remain skeptical about rate cuts in September. They argue that inflation remains sticky, and labor market resilience may keep the Fed on hold until 2026.
Not long ago, Fed Chair Jerome Powell reaffirmed a wait-and-see approach, noting inflation risks from tariffs and world conflicts, thereby cooling expectations for an immediate cut. However, certain Fed officials, like Waller and Bowman, disagreed and wanted to cut rates, showing that there’s a disagreement inside the Fed about what to do next.
Crypto could profit from this
If the rate cuts indeed happen in the near future, it could be a positive boost for the crypto industry and cryptocurrencies. Lower interest rates usually inject liquidity, shifting capital into risk assets, which is historically a bullish catalyst for Bitcoin and Ethereum.
The news of possible rate cuts has been hovering around for some time now, and the crypto markets reacted to this new hype, even if for a little bit. Bitcoin rallied toward roughly $114k, and altcoins like Ether, XRP, and Cardano gained a small boost as well.
Analysts generally expect Bitcoin target in the above $124k range by year-end if cuts materialize, along with similar momentum in other cryptocurrencies.
Still, it’s better not to go headfirst, since if the Fed holds rates steady or delays cuts, markets may reverse quickly. Plus, August and September historically are weaker months for Bitcoin, regardless of macro conditions.
The Fed’s timing is everything, and depending on which way it goes, crypto assets could potentially either see a price boost or a drop.
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