Nearly 67% of investors forecast an interest rate cut of 25 basis points in December when polled during the first week of November.
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Only 45.9% of investors anticipate an interest rate cut at the next US Federal Open Market Committee (FOMC) meeting in December, amid declining market sentiment and a downturn in the cryptocurrency market.
The odds of a 25 basis point (BPS) interest rate cut in December were nearly 67% on Nov. 7, according to from the Chicago Mercantile Exchange (CME) Group.
In September, several banking institutions in 2025, with market analysts at investment banking company Goldman Sachs and banking giant Citigroup each projecting three 25 BPS cuts in 2025.
. Lower interest rates translate into more liquidity flowing into asset markets and propping up prices, while higher rates mean liquidity and prices will be constrained.
The declining odds of a December rate cut are feeding and may signal that more short-term price pain is coming to the crypto market until the Federal Reserve resumes easing rates.
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“There were strongly differing views about how to proceed in December. A further reduction in the policy rate at the December meeting is not a foregone conclusion — far from it. Policy is not on a preset course,” Federal Reserve Chair Jerome Powell in October.
As expected, the Federal Reserve in October; however, crypto prices following the lowered rates.
The October rate cut was “fully priced in” by investors, who widely anticipated the cut months ahead of time, according to Matt Mena, a market analyst at investment company 21Shares.
Economist and former hedge fund manager Ray Dalio that the Federal Reserve is cutting rates into record-high asset prices, relatively low unemployment and low credit spreads, a historic anomaly.
In November, Dalio said the Federal Reserve is likely , adding that this is a feature typical of debt-laden economies headed toward hyperinflation and currency collapse.
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