Citigroup has revised its expectations for U.S. Federal Reserve interest rate cuts, moving the anticipated timing to September 2025. This shift may influence financial markets and cryptocurrencies.
Citigroup's Forecast Change
Citigroup's economic research team announced a revision of its expected date for the Federal Reserve's next interest rate cut from July to September 2025. This adjustment indicates changes in the economic outlook and inflation control measures, with cumulative cuts projected to total 125 basis points for 2025.
Impact on Cryptocurrencies
The altered timeline may negatively impact cryptocurrency markets. For instance, Bitcoin and Ethereum, sensitive to interest rate changes, could experience volatility. Johanna Chua of Citigroup noted that delays often reduce the total value locked in decentralized finance systems. Past trends show that such measures lead to decreased tokens on DeFi platforms.
Conclusion
Citigroup's forecast change may have long-term implications for both traditional and cryptocurrency markets. Investors and analysts remain cautious, considering the potential impacts related to slower Fed rate cuts.
The delay in Fed rate cuts until September 2025 adds uncertainty to financial markets and may affect cryptocurrency recovery.
