Bitcoin prices have plummeted in recent months from their record highs of $120,000 down to just $82K. The leading cryptocurrency is currently trading at $84,000. This coin has fallen 14% year-to-date, and leads a bearish market that’s caused by an uncertain US economy in 2025.
Analysts want to see BTC return towards $100k by the end this year. Federal Reserve’s decision to reduce interest rates or not could spark the price of BTC.
Can a rate cut help Bitcoin regain its $100k price?
Following the rate reduction last month, several investment firms predicted that the Fed would cut rates once again. The recent US Government Shutdown, which lasted more than 40 days and set a new record for duration of a shutdown in the US history, could cause snags to this forecast. Fed cut rates in two stages in 2025. Most recently, in October.
Jerome Powell, Federal Reserve chair after the rate cut in October, also said that there may be no further rate cuts in 2025. The recent government shutdown could determine whether we see another rate cut.
Also Read: Fed At Odds About Dec. Rate Cut: Where Does Crypto Stand?
Interest rate reductions are often viewed as bullish, because they can lead to an increase in high-risk investments as the borrowing process becomes more convenient. Powell warned that the rate cut may lead to a correction of cryptocurrency prices. Powell stated that the job market has been slowing down and there are more employment risks. In addition, Powell stated that the inflation rate has been rising. “has moved up since earlier this year and remains somewhat elevated.”
New York Fed President: On the contrary, at the close of the past week, we saw a bullish sign. John Williams. Wall Street Journal: The Fed Representative told them that there are still “room for a further adjustment” to interest rates in the near term — a clear hint that a December rate cut is back on the table. The rate cut is back on the table. CME’s FedWatch ToolUp from 39% only on Thursday, the likelihood of a December 25-bps rate cut has increased to 70%. Bitcoin, and other cryptocurrencies may see an increase in price if a cut is made. This could bring a positive end to 2025.
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Source: watcher.guru
