Bitcoin Reacts to Fed's Rate Cut Decision

The U.S. Federal Reserve has decided to implement a 25-basis-point rate cut following its two-day meeting. 

This is in line with analysts' expectations, which is why stocks and Bitcoin did not experience substantial volatility. Every major brokerage, including Goldman Sachs, Barclays, and BofA Global Research, predicted that the Fed would opt for a 25-basis-point cut. A whopping 99% of Polymarket users also placed their bets on the aforementioned scenario. Hence, any other decision would have been extremely shocking. 

The largest cryptocurrency is currently trading at $76,631, according to data provided by CoinGecko. Earlier today, the leading cryptocurrency hit a new record high of $76,637.

As reported by U.Today, the Fed surprised the market with a mighty 50-basis-point rate cut in September in response to cooling inflation. Back then, Federal Reserve Chair Jerome Powell stressed the importance of achieving its much-coveted 2% target without causing a substantial increase in unemployment. 

The first rate cut in four years has helped to substantially boost the price of Bitcoin. The same applies to U.S. equities. 

As noted by Ryan Detrick, chief market strategist at Carson Group, the Fed serves as a "tailwind" for the stock market. "They've done this 20 other times and a year later stocks were higher 20 times. As we've been saying all year, the Fed is a tailwind," he said.

Polymaket bettors also see a 66% chance of another 25-basis-point rate cut being implemented in September.