#Fed Rate Cut #Odds Surge to 80%, Setting the Stage for Potential Bitcoin Rally in September

Fed Rate Cut Odds Spike to 80% on August 1, Boosting Bitcoin Outlook

The probability of Federal Reserve interest rate cuts in September surged dramatically to 80% on August 1, after earlier in the week falling to as low as 20%. This rapid shift in expectations has ignited optimism for a near-term boost in Bitcoin (BTC) prices, potentially setting the stage for renewed upward momentum in the cryptocurrency market.

The Fed’s July Meeting: Hawkish Pause and Market Repricing

During the Federal Reserve’s July 31 meeting, the central bank maintained a hawkish stance, opting for a pause rather than signaling an imminent rate cut. This stance led markets to sharply reduce their expectations for September rate reductions, which in turn dragged #Bitcoin ’s price down from a near-term high of approximately $120,000 to around $114,000.

However, new economic data released on August 1 challenged this hawkish narrative and has investors and traders revisiting the possibility of a dovish Fed pivot.

Weak U.S. Labor Data Fuels Rate Cut #Speculation The catalyst for the sudden jump in rate cut odds was a notably weak U.S. jobs report for July. The economy added only 73,000 jobs, significantly underperforming the forecasted 106,000. This unexpected softness in the labor market raised concerns about the health of the U.S. economy and increased speculation that the Fed may need to ease monetary policy to support growth.