The US Federal Reserve has announced its eighth and final policy decision for 2024, cutting the interest rate by 25 basis points, marking the third reduction this year.
Interest Rate Decision
The Federal Open Market Committee decided to lower the key rate by 25 basis points after its two-day meeting. This outcome was widely expected, with CME Group’s FedWatch tool indicating a 99% probability of this rate cut.
Fed Policy and Its Implications
Following Donald Trump's victory in the presidential election, the Fed cut the rate by 50 basis points in September, reflecting confidence in inflation stabilization. Fed Chair Jerome Powell stated the committee is not in a hurry to make further rate cuts. Beth Hammack from the Cleveland Fed highlighted that strong growth, a robust labor market, and high inflation justify maintaining a modestly restrictive monetary policy.
Impact on Cryptocurrencies
While a rate cut is favorable for Bitcoin's price, Presto Labs analyst Min Jung noted the market has already priced this in. Attention will shift to the December meeting and economic projections, which may influence cryptocurrency prices.
The Fed’s decision aligns with market expectations. Focus will now shift to further Fed actions and their impact on economic development and cryptocurrency pricing.
