Recent changes in the global economy could lead to interest rate cuts by the Fed, raising interest in the reactions of Bitcoin and Ethereum prices.
The Role of Fed Interest Rate Cuts
Three Federal Reserve members expressed a preference for rate cuts in July, while two others believe it’s too soon. The decisive factor for these rate cuts will be the impact of tariffs on inflation. The anticipated tariff deals around July 4 will be instrumental in guiding the Fed’s actions.
President Trump recently commented on this issue, suggesting that tariffs imposed during June, July, or August could have significant inflationary effects. In the absence of such impacts, an early transition to rate cuts might be feasible.
Predictions for Bitcoin and Ethereum Prices
Institutional demand for Bitcoin remains strong, with spot BTC ETFs surpassing $1 trillion in cumulative volume in less than 18 months. Bitcoin ETFs have ignited more excitement than Gold’s ETF debut.
Analyst DaanCrypto noted lackluster price performance during US and EU sessions, while the Asian session remained relatively flat. Significant ETF inflows have been observed, yet general selling continues during US sessions, indicating substantial supply within the current price range.
Potential Market Consequences
For the ETH price, analyst CryptoNoach highlighted the importance of maintaining the $2,450 support level, predicting a potential fall back to the $2,100-$2,150 demand zone in the event of significant decline. However, given the positive reception of ETF inflows, expectations are relatively optimistic.
The Fed's interest rate cuts may significantly impact the cryptocurrency market, especially Bitcoin and Ethereum prices. The anticipated market response will depend on the further development of economic conditions and tariff policies.
