Bitcoin Price Reaches Three-Week High with Rate Cut: A Strong Start to the Easing Cycle, Bitcoin has seen a significant rise in value
following the U.S. Federal Reserve’s interest rate cut, which had a notable impact on global financial markets.
This move is a solid start to the monetary easing cycle,
bringing positive news for high-risk assets such as cryptocurrencies and stocks.
This article examines the effects of these events and how the markets respond.
Content
Rate Cut and Its Impact on Markets
Expert Opinions on the Impact of the Easing Cycle
Challenges of Future Monetary Policy
Impact on Traditional Markets and Cryptocurrencies
Market Movements and Economic Indicators
Bitcoin Rises with Rate Cut
Bitcoin’s price reached its highest level in three weeks, climbing 3.9% to $61,980 as of 10:17 AM Thursday, Singapore time.
This rise occurred alongside increased U.S. stock futures,
as traders expressed optimism after the Federal Reserve reduced interest rates sharply.
Asian markets also saw gains as traders adjusted their expectations with the anticipated start of the Federal Reserve’s easing cycle.
Rate Cut and Its Impact on Markets
The U.S. central bank cut borrowing costs by 50 basis points, marking the first reduction over four years.
However, Federal Reserve Chairman Jerome Powell was cautious in committing to a similar pace of cuts in the future,
emphasizing that any forthcoming actions would be based on economic data.
This careful stance helped calm U.S. market reactions during Wednesday’s trading hours.
Expert Opinions on Easing Cycle’s Impact
In this context, Caroline Moron, co-founder of Orbit Markets,
a company specializing in providing liquidity for trading digital asset derivatives,
stated that “the strong start to the easing cycle is good news for high-risk assets like Bitcoin.
The market took a few hours to absorb the full picture and react to the improved expectations.”
Challenges of Future Monetary Policy
Before the Federal Reserve meeting, opinions were divided on whether officials would opt for a quarter or half-point rate cut.
As Powell and his colleagues try to maintain the strength of the U.S. economy,
the balance between risks related to the labor market and inflation is becoming increasingly delicate.
Impact on Traditional Markets and Cryptocurrencies
David Lawant, head of research at FalconX,
noted that “attention will quickly shift to the size and extent of this cycle.
The key factor to watch from now on is the trajectory of economic activity.”
Recently, the correlation between cryptocurrencies and traditional investments like stocks has increased,
indicating that macroeconomic variables increasingly influence digital asset markets.
Market Movements and Economic Indicators
At the same time, the U.S. dollar index stabilized, while U.S. Treasury yields fell,
reflecting Powell’s cautious signal about the scale of future monetary easing.
Chris Weston, head of research at Pepperstone Group, wrote in a note:
“The future response of the Federal Reserve remains unclear as it continues down an undefined path.”
This development highlights how global markets have quickly responded to the rate cut,
emphasizing the importance of closely monitoring future monetary policies
and their impact on various assets, including cryptocurrencies.
Bitcoin Price Reaches Three-Week High with Rate Cut