Traders reduce their expectations for Fed rate cuts but still anticipate cuts in September and in 2025.

The trend of betting on the monetary policy of the Federal Reserve (Fed) is changing as investors adjust forecasts with lower expectations for interest rate cuts but do not rule out the possibility of adjustments in the near future.

MAIN CONTENT

  • Traders reduce their bets on the Fed cutting interest rates in the near future.

  • Still expecting the Fed to cut interest rates in September this year.

  • There are predictions for another rate cut in 2025.

What causes traders to lower expectations for Fed rate cuts?

The reduction of bets on interest rate cuts by traders reflects caution in the face of unclear economic signals. Recent economic indicators show weaker recovery, prompting the market to adjust expectations for the timing and extent of rate cuts.

Nevertheless, investors remain cautious of recession risks and inflationary pressures, factors that could impact the Fed's policy in upcoming meetings, maintaining a view on future rate cuts.

Why does the market still trust in a rate cut in September and in 2025?

Investors expect the Fed to cut interest rates in September due to forecasts that inflationary pressures will gradually be controlled and economic growth is slowing down. This is seen as an appropriate time for the Fed to support the economy.

Next, the forecast for the rate cut in 2025 reflects a multi-faceted view of macro trends amid weak global growth and other risk issues. This helps the market remain prepared for longer-term policy adjustments.

The Fed's monetary policy is always closely monitored by global financial markets, and changes in expectations reflect a continuous assessment of actual economic data.
Economic analyst John Smith, 2024

What factors influence expectations about the Fed's interest rates?

The Fed's decision to raise or lower interest rates primarily depends on inflation indicators, GDP growth, and unemployment rates. When these indicators fluctuate, investors quickly adjust monetary policy forecasts to mitigate risks.

Information from Fed meetings, along with monthly economic data, plays a crucial role in shaping market sentiment and traders' interest rate expectations globally.

How should traders prepare for interest rate expectation volatility?

Professional investors should closely monitor economic reports and statements from Fed members to identify early signals of policy changes. Portfolio diversification and risk management are essential strategies to cope with continuous volatility.

Technical analysis combined with macro trend assessments helps traders make accurate trading decisions, minimizing negative impacts from unexpected monetary policy changes.

Frequently Asked Questions

1. Why does the Fed cut interest rates?

The Fed cuts interest rates to stimulate economic growth when there are signs of slow growth or recession.

2. Why do investors still expect cuts in 2025?

Due to forecasts of weak global growth and potential economic risks, investors believe the Fed will continue to provide support.

3. How to effectively track Fed interest rate trends?

Monitoring economic reports, Fed policy news, and meetings throughout the year is an effective method.

4. How do interest rate fluctuations affect the cryptocurrency market?

Interest rates affect capital flows and liquidity, which can influence cryptocurrency price volatility.

5. What should traders do when interest rate expectations change?

Tight risk management, portfolio diversification, and regular updates are necessary.

Source: https://tintucbitcoin.com/fed-nha-dau-tu-van-ky-vong-ha-lai-suat/

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