The probability of the Federal Reserve (Fed) cutting interest rates in the coming months is rated very highly.

Data from CME Fed Watch on August 7 shows that the probability of the Fed keeping interest rates unchanged in September is only 6.4%, while the probability of a 25 basis point cut is as high as 93.6%. In October, the cumulative probability of an interest rate cut is even higher.

MAIN CONTENT

  • The probability of the Fed cutting interest rates by 25 basis points in September is 93.6%.

  • The probability of keeping interest rates unchanged in September is only 6.4%.

  • In October, the cumulative probability of a 50 basis point rate cut rises to 64%.

Is the Fed likely to keep interest rates unchanged or cut them in September?

According to CME Fed Watch data updated on August 7, the probability of the Fed keeping interest rates unchanged in September is only 6.4%. Meanwhile, the probability of a 25 basis point cut is as high as 93.6%, indicating that the market has high expectations for an interest rate cut at this meeting.

This reflects a signal that the Fed is trending toward supporting economic growth after recent economic reports. Cryptocurrency and financial investors are closely monitoring these moves due to their direct impact on capital flows and credit costs in the global market.

What are the changes in the Fed's interest rate outlook for October?

CME Fed Watch indicates that the probability of keeping interest rates unchanged in October is even lower, at only 2%. The cumulative probability of a 25 basis point cut is 33.9%, while the cumulative probability of a 50 basis point cut is as high as 64%. This shows that the chance of the Fed aggressively cutting interest rates continues to increase.

This trend suggests that policymakers may adopt stimulus measures to promote growth amid periods of economic uncertainty. This data also influences the investment strategies of many financial institutions and cryptocurrency traders.

"The financial market is currently interpreting Fed Watch data as a clear sign of monetary easing in September and October. This reflects efforts to cope with economic infrastructure pressures."

Economic Expert Nguyen Van Hung, 2024

What factors are driving the Fed's interest rate cut forecast?

The global economic situation, including reduced inflationary pressure and increased risk of recession, is causing the Fed to consider lowering interest rates. Weaker employment reports and a slowdown in manufacturing activity are also fueling expectations of policy easing.

These moves not only affect the US economy but also directly impact the cryptocurrency market through changes in the USD exchange rate, domestic interest rates, and global investment flows.

How should cryptocurrency investment strategies be adjusted in the face of this forecast?

The Fed's expected interest rate cuts could create conditions that support the flow of funds into risky assets such as cryptocurrencies. Investors should consider using risk management tools and closely monitor exchange rate fluctuations as well as monetary policy to optimize portfolio performance.

Monitoring Fed Watch and economic reports is essential to make timely decisions, avoiding surprises from strong fluctuations in traditional and cryptocurrency markets.

Frequently Asked Questions

1. What is Fed Watch?

Fed Watch is a tool of CME Group that forecasts the probability of interest rate decisions by the Federal Reserve based on the interest rate futures market.

2. How does the Fed's interest rate cut affect cryptocurrencies?

Lower interest rates typically increase the flow of risky capital, which can help cryptocurrency prices rise due to cheaper borrowing costs and increased liquidity.

3. Is the probability of a 50 basis point rate cut in October high?

CME Fed Watch recorded a 64% probability, indicating a high likelihood that the Fed will cut rates more deeply to support the economy.

4. Should investment strategies be changed when the Fed cuts interest rates?

Information should be closely monitored and the portfolio adjusted to suit increased liquidity fluctuations, but risk management should still be emphasized.

5. Does Fed Watch data change continuously?

Yes, Fed Watch is updated daily according to futures market fluctuations and the latest economic factors.

Source: https://tintucbitcoin.com/fed-co-the-ha-lai-suat-thang-9-4/

Thank you for reading this article!

Please Like, Comment and Follow TinTucBitcoin to always update the latest news about the cryptocurrency market and don't miss any important information!