Starting in September and continuing for the next seven consecutive meetings until July 2025, the Federal Reserve will reduce the key rate eight times by 25 basis points each, totaling a 2% decrease. This was stated by Citi analysts, according to Fortune.
Subsequently, the regulator will maintain the key rate at 3.25% until the end of the following year.
Experts noted that the Fed will decide to change its policy as the economy is “heading towards a sharp slowdown.”
As indicators of this trend, analysts mentioned the rise in unemployment to 4.1% and a cooling of business activity in the services sector. Citi also highlighted the “dovish” tone of recent comments by Fed Chair Jerome Powell.
On July 9 at 17:00 (Kyiv/MSK), the Fed Chair will address the Senate Banking Committee. Signals regarding adjustments to monetary policy can be expected.
At the time of writing, the swap market estimates a 70% chance of a rate cut in September, according to Bloomberg.
The previous meeting in June led to a decrease in risk appetite, contributing to negative trends in cryptocurrencies.
Earlier, 10x Research predicted Bitcoin’s return to a growth trajectory amid easing inflation and the Fed’s approach to the start of a policy easing cycle.