TopCoinsSeptember2024

According to Odaily, Zaheer Ebtikar, founder of the crypto fund Split Capital, has indicated that the global market anticipates a weakening of the Federal Reserve's dovish stance by 2025. This expectation is prompting crypto event traders and market makers to reduce their risk exposure. On Wednesday, Federal Reserve officials lowered the benchmark interest rate for the third consecutive time, while also controlling the number of rate cuts expected in 2025. Typically, lower interest rates boost demand for higher-risk assets, such as cryptocurrencies.David Lawant, Head of Research at crypto prime broker FalconX, noted that while the current rate cut forecasts are influencing prices, they may not have a lasting impact due to the decreasing correlation between Bitcoin and major stock indices. Lawant explained that the anticipated slowdown in rate cuts by 2025 is not entirely unexpected, but it does exert some pressure on risk assets, including cryptocurrencies. Although macroeconomic factors have traditionally influenced cryptocurrency price trends, industry-specific factors may become more dominant in the coming weeks and months, especially as the market anticipates policy changes from a new administration.

According to Odaily, Deutsche Bank has released a report analyzing the implications of this week's Federal Open Market Committee (FOMC) meeting. The report suggests that the Federal Reserve's meeting reinforces the bank's core view that the anticipated rate cut in January might transform into a prolonged pause by 2025. Deutsche Bank maintains that the nominal neutral interest rate is approximately 3.75%, and it is essential for the committee to maintain a restrictive stance relative to this level. Consequently, the bank reiterates its position that the federal funds rate is likely to remain above 4% next year, with no further rate cuts expected under the current baseline scenario.

The report also highlights that some Federal Reserve participants have begun to incorporate the potential economic impacts of President-elect Trump's policies into their forecasts. This consideration could lead to higher inflation projections for 2025 and 2026. In terms of the labor market, Federal Reserve Chair Jerome Powell described it as solid but noted that the current level of job creation is below what is necessary to maintain a stable unemployment rate. This assessment underscores the challenges facing the labor market and the broader economic outlook as policymakers navigate the evolving economic landscape.