- Potential Federal Reserve rate cut affects markets and asset prices.
- Service price inflation drives rate cut expectations.
- Impact on cryptocurrencies like BTC, ETH, and DeFi.
Service prices and tariffs raise inflation concerns, prompting expectations for a Federal Reserve rate cut in September 2025. Key figures like Fed Governor Waller and Chair Powell suggest such a move could support employment and control inflation.
The Federal Reserve is widely anticipated to cut rates at the September 2025 meeting as service price hikes and tariffs raise inflation concerns.
Rate cut expectations highlight inflationary concerns impacting the U.S. economy and digital asset markets.
Service prices and tariffs are increasing inflation concerns, prompting expectations of a Federal Reserve rate cut at the September 2025 meeting. Fed Governor Christopher J. Waller supports a cut to maintain labor market health and reach inflation targets. Major financial institutions like BlackRock and J.P. Morgan are adjusting portfolios in anticipation of policy changes.Cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH), are poised for increased volatility. Past rate cuts led to surges in DeFi token valuations and increased Total Value Locked in protocols.
“I favored reducing the federal funds rate by 25 basis points at the FOMC’s July meeting, and subsequent data on the labor market and inflation indicate this was the right call…I am still hopeful that easing monetary policy at our next meeting can keep the labor market from deteriorating while returning inflation to the FOMC’s goal of 2 percent. So, let’s get on with it.” — Christopher J. Waller, Governor, Federal Reserve
The expectation of a rate cut has reshaped investment strategies, with asset managers favoring mid-duration bonds and credit. Lower rates usually boost risk assets.
As U.S. interest rates potentially fall, macro and crypto markets may shift toward greater risk appetite, enhancing digital asset market dynamics. Historical data suggests a rate cut would bolster crypto adoption and capital influx, as observed during previous cycles with increased on-chain activity.
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