The odds of the Federal Reserve cutting interest rates this December just shot up to 74.5%, according to the CME FedWatch tool. This would mark the third rate cut of the year, bringing the target range down to 4.25%-4.5% from the current 4.5%-4.75%. The increased probability, up from 66% just days earlier, reflects growing market confidence in a 25-basis-point reduction.
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Waller Signals Conditional Support for Rate Cut
Federal Reserve Governor Christopher Waller hinted at his stance during a Dec. 2 speech, saying, “At present, I lean toward supporting a cut.” However, he stressed that upcoming data on employment, consumer spending, and inflation could sway his decision. The New York Fed President John Williams also expects rates to decline “over time” but stopped short of committing to backing a cut this month.
Bitcoin’s Rally Tied to Fed Moves
Historically, lower borrowing costs have driven demand for riskier assets like cryptocurrencies. Bitcoin, currently priced around $95,800, has more than doubled this year, fueled by optimism in the U.S. market and regulatory overhaul promises by President-elect Donald Trump. Analysts are now betting on Bitcoin hitting $100,000 before year-end if the Fed cuts rates.
Markets Await Powell’s Remarks
All eyes are on Federal Reserve Chair Jerome Powell, who is set to discuss monetary policy in New York on Dec. 4. His comments could confirm or dash hopes for a rate cut this month, setting the tone for the markets as the Fed’s meeting on Dec. 17-18 approaches.
Investors eager to anticipate the Federal Reserve’s next move can use the TipRanks Inflation Rate tool to track inflation trends directly.
