Citigroup predicts that the Fed will cut interest rates by 50 basis points in September and November respectively.
This forecast by Citigroup is undoubtedly like a heavy bomb, thrown directly into the already turbulent financial market pond. The news of the Fed's interest rate cut always has a strong impact on the market, and will have a far-reaching impact on both the traditional financial market and the crypto market.
Let's analyze its possible impact through two similar events in history:
During the global financial crisis in 2008, the Federal Reserve cut interest rates sharply several times in succession to cope with the economic recession. This series of measures not only saved the traditional financial market, but also pushed up the prices of safe-haven assets such as gold. Similarly, Bitcoin had not yet been born at that time, but this loose policy paved the way for the subsequent development of digital currencies.
At the beginning of the outbreak of the new crown epidemic in 2020, the Federal Reserve urgently cut interest rates and introduced quantitative easing policies. This move directly led to a strong rebound in the stock market, and also helped Bitcoin soar from less than $10,000 to more than $60,000 in the following year.