Federal Reserve Governor Christopher Waller has backed a potential interest rate cut at the upcoming September meeting. Investors are anxiously awaiting the potential impact on digital assets.
Fed Governor's Announcement
According to CNBC, Fed Governor Christopher Waller on Friday supported an interest rate cut at the central bank's upcoming policy meeting in less than two weeks. Waller echoed Fed Chair Jerome Powell's statement from late August that 'the time has come' for monetary policy adjustment, but did not specify the pace and magnitude of the cuts.
Crypto Market Reaction
So far, the cryptocurrency market has had little reaction to Waller's comments. Cryptocurrencies witnessed mixed price action in early Saturday trade, with Bitcoin falling 3% in the last 24 hours to $54,360. Several cryptocurrencies also fell, with Ethereum, Dogecoin, and Pepe reporting losses of more than 4% each. A few assets such as Algorand, BONK, and Optimism traded in the green with gains up to 4%.
Impact of Rate Cuts
A looser monetary policy is frequently considered beneficial for speculative assets. This is because lower interest rates may encourage investors to seek better returns in riskier assets such as cryptocurrencies, potentially driving up prices.
Waller's remarks have become one of the clearest signals that easing might occur at the September 17-18 Federal Open Market Committee meeting. The subdued hiring pace and weak employment reports may heighten expectations for rate cuts and their impact on both traditional and digital assets.
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