- Federal Reserve reduces interest rates by 0.25%.
- Decision addresses inflation and labor market concerns.
- Impacts on risk assets like Bitcoin and Ethereum are likely.
The U.S. Treasury Secretary did not publicly state that Powell should signal a 100-150 basis point rate cut. No official records or briefings reflect such a demand, corroborated by recent Federal Reserve documentation and public statements.
The Federal Reserve, led by Chair Jerome Powell, announced a 0.25% rate cut on September 17, 2025, during the FOMC meeting to address economic concerns.
This action is significant as it addresses inflation and employment challenges, signaling potential shifts in financial markets. Market observers anticipate movements in cryptocurrency and other risk assets.
Chair Jerome Powell, emphasizing a data-dependent approach, led the FOMC in reducing the federal funds rate to 4โ4.25%. The decision, while supported by major leadership, saw dissent from Governor Stephen Miran, who preferred a steeper cut of 0.5%.
โWe take the actions that we take with an eye on those goals. Separately, we monitor financial stability very, very carefullyโฆ I would say itโs a mixed picture. But households are in good shape. Banks are in good shape.โ โ Jerome Powell, Chair, Federal Reserve
Financial markets may experience adjustments due to this rate change. Historically, rate cuts lead to increased activity in risk assets, including cryptocurrencies like Bitcoin and Ethereum. Analysts foresee potential changes in trading volumes and volatility in these markets.
This rate cut reflects ongoing concerns about the U.S. economy, with inflation and labor market pressures driving the decision. Such measures ultimately aim to promote stability while managing risks associated with economic softening.
Traditionally, major rate cuts have led to increased interest in digital assets and DeFi markets. Participants might shift investments as yield differentials narrow. Historically, lower traditional yields have pushed investors towards digital assets and associated DeFi protocols.
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