Fed’s Rate-Cut Plan Revealed: 3 Moves That Could Impact Crypto
Federal Reserve Governor Michelle Bowman is pushing for three interest rate cuts before 2025, a stance she recently shared at the Kansas Bankers Association in Colorado Springs. Her comments come amid a policy standoff between former President Trump and Fed Chair Jerome Powell.
For months, the Fed has kept rates steady between 4.25% and 4.50%, despite political pressure from Trump and the White House to ease borrowing costs. Most members of the Federal Open Market Committee (FOMC) remain focused on keeping inflation under control.
Bowman, however, points to weakening labor market data — unemployment rising from 4.1% to 4.2% and job growth slowing to just 73,000 — as a reason to act. She proposes rate cuts in September, October, and December, aiming to prevent further damage to employment and maintain economic stability.
Her view is shared by fellow Fed Governor Chris Waller, but not yet by the majority of FOMC policymakers. Bowman argues that Trump’s tariffs are unlikely to drive up inflation, and with core inflation trending toward 2% and demand remaining soft, the focus should shift toward supporting jobs.
Other Fed leaders — including Governor Lisa Cook, San Francisco Fed President Mary Daly, and Minneapolis Fed President Neel Kashkari — have also expressed concern about recent employment numbers, adding weight to the possibility of rate cuts.
Historically, lower rates have fueled investment in risk assets like cryptocurrencies. With Trump’s pro-crypto stance, along with initiatives like the GENIUS Act and the SEC’s crypto project, the stage could be set for more capital to flow into the crypto market if these cuts happen.