New York, Thursday, September 19, 2024 – The US Federal Reserve slashed its benchmark interest rate by 50 basis points, bringing it down to 4.75%-5.00%.
This is the first time in four years that the Fed has made such a sharp rate cut.
Fed highlighted the decision as a recalibration to protect the job market and sustain economic stability. However, the rate cut has drawn mixed reactions, with some Fed officials dissenting over its size.
As the Fed kicked off its rate-cutting cycle, Bitcoin and other major cryptocurrencies surged in response.
Bitcoin rallied above $62,000, a 2.4% increase within 24 hours of the announcement. Solana (SOL), BNB, XRP, and Cardano (ADA) also saw significant gains, driven by optimism over the looser monetary policy.
However, market analysts warned that the rally might be short-lived, given the global economic slowdown and ongoing geopolitical tensions.
ByBit said that while the rate cut may fuel short-term gains in the cryptocurrency market, the broader economic environment remains challenging.
Despite uncertainties, traders said that they remain confident about continued Fed rate reductions, with Polymarket bettors expecting more cuts in upcoming Federal Open Market Committee (FOMC) meetings.
Overall, the Fed’s decision has rejuvenated Bitcoin’s market momentum but cast a shadow of caution among investors.
