Many financial institutions and market analysts predict that the Federal Reserve in America (Fed) will cut the target interest rate currently at 4.25% – 4.5%( at least twice in 2025.
This forecast comes after the disappointing August jobs report, which recorded only 22,000 new jobs compared to expectations of around 75,000.
Bloomberg reported that experts from Bank of America have reversed their long-held view that the Fed will not cut interest rates in 2025. The bank now predicts that the Fed will implement two cuts of 25 basis points )BPS(, respectively in September and December.
Meanwhile, Goldman Sachs predicts that the Fed will cut interest rates three times in 2025, each time by 25 BPS, starting in September and continuing in October and November.
Reuters cites a forecast from Citigroup that the Fed will cut a total of 75 BPS in 2025, divided into three rounds in September, October, and December.
![])https://img-cdn.gateio.im/webp-social/moments-ff7881b68f092ce2c98b831479193edf.webp(The target probability for the interest rate at the next Federal Reserve meeting in September | Source: CME GroupAccording to data from CME Group, currently 92% of traders predict the Fed will cut the interest rate by 25 BPS at the Federal Open Market Committee )FOMC( meeting in September, while about 12% predict a cut of 50 BPS.
Low interest rates – a catalyst for the crypto market
The fall in interest rates is seen as an important factor driving the flow of money into the crypto market, supporting price increases and maintaining growth cycles. Conversely, high interest rates often put downward pressure on asset prices.
On August 22, at the Jackson Hole Economic Symposium )Wyoming(, Fed Chairman Jerome Powell signaled the possibility of cutting down the whales as early as September, amid a weakening labor market in America.
![])https://img-cdn.gateio.im/webp-social/moments-b0dec65bd011df9621432a252c7a7323.webp(The U.S. job market shows signs of weakness, with the number of unemployed individuals exceeding the number of job openings. Source: The Kobeissi LetterAccording to The Kobeissi Letter, the June jobs report has been revised down for the second time, totaling -160,000 jobs, meaning America has effectively lost 13,000 jobs that month.
In addition, Kobeissi warned that the U.S. Bureau of Labor Statistics )BLS( has cut the 2024 employment data down to approximately 818,000 and may continue to adjust the 2025 data down by up to 950,000 jobs.
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Big banks predict that the Fed will cut interest rates at least twice in 2025.
Many financial institutions and market analysts predict that the Federal Reserve in America (Fed) will cut the target interest rate currently at 4.25% – 4.5%( at least twice in 2025.
This forecast comes after the disappointing August jobs report, which recorded only 22,000 new jobs compared to expectations of around 75,000.
Bloomberg reported that experts from Bank of America have reversed their long-held view that the Fed will not cut interest rates in 2025. The bank now predicts that the Fed will implement two cuts of 25 basis points )BPS(, respectively in September and December.
Meanwhile, Goldman Sachs predicts that the Fed will cut interest rates three times in 2025, each time by 25 BPS, starting in September and continuing in October and November.
Reuters cites a forecast from Citigroup that the Fed will cut a total of 75 BPS in 2025, divided into three rounds in September, October, and December.
![])https://img-cdn.gateio.im/webp-social/moments-ff7881b68f092ce2c98b831479193edf.webp(The target probability for the interest rate at the next Federal Reserve meeting in September | Source: CME GroupAccording to data from CME Group, currently 92% of traders predict the Fed will cut the interest rate by 25 BPS at the Federal Open Market Committee )FOMC( meeting in September, while about 12% predict a cut of 50 BPS.
Low interest rates – a catalyst for the crypto market
The fall in interest rates is seen as an important factor driving the flow of money into the crypto market, supporting price increases and maintaining growth cycles. Conversely, high interest rates often put downward pressure on asset prices.
On August 22, at the Jackson Hole Economic Symposium )Wyoming(, Fed Chairman Jerome Powell signaled the possibility of cutting down the whales as early as September, amid a weakening labor market in America.
![])https://img-cdn.gateio.im/webp-social/moments-b0dec65bd011df9621432a252c7a7323.webp(The U.S. job market shows signs of weakness, with the number of unemployed individuals exceeding the number of job openings. Source: The Kobeissi LetterAccording to The Kobeissi Letter, the June jobs report has been revised down for the second time, totaling -160,000 jobs, meaning America has effectively lost 13,000 jobs that month.
In addition, Kobeissi warned that the U.S. Bureau of Labor Statistics )BLS( has cut the 2024 employment data down to approximately 818,000 and may continue to adjust the 2025 data down by up to 950,000 jobs.
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