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Interest rate cut! Is it about to rise?

In the financial market, interest rates act like a master switch; the higher they are, the harder money flows; once lowered, the entire market atmosphere changes completely. The so-called "interest rate cut" simply means borrowing money becomes cheaper, and funds are no longer locked by high interest rates, but start to flow freely.

When an interest rate cut occurs, the most direct effect is that both businesses and individuals can borrow money more easily. With lower company loan rates, the willingness to invest or expand increases; the pressure on people's mortgage and car loans decreases, making them more willing to spend. These small changes accumulate to stimulate the entire economy.

Interestingly, after money becomes cheaper, many people no longer want to keep their funds in banks waiting for that meager interest; they start to flock to the stock market, bond market, and even cryptocurrency market. This is why once the market catches a whiff of an interest rate cut, risk assets often rise first to show you.

Of course, an interest rate cut is not without side effects. As interest rates fall, the attractiveness of currency decreases, which can sometimes lead to currency depreciation; however, this is good news for exporting countries. In other words, an interest rate cut is like a shot of adrenaline; some areas may feel comfortable, while others may experience noticeable side effects, but overall, it revitalizes the market.

What the market is most concerned about now is when the United States will officially start the interest rate cut cycle. Because as soon as the Federal Reserve takes action, global capital flows will be changed accordingly. If interest rates are really cut, capital will certainly surge back into risk assets, and at that time, whether it's the stock market or cryptocurrencies, a new wave of market trends may be on the horizon.