CMC News

$BTC Stays Stable as Fed Cuts Rates by 25 Basis Points

#TheFederalReserve slashed interest rates by 25 basis points on Wednesday, dropping the federal funds rate to the 4%-4.25% range in its first reduction since December 2024. The decision came despite inflation stubbornly holding at 2.9%, well above the central bank's 2% target amid mounting economic pressures.

President #Trump has waged an unprecedented campaign against Fed Chair #JeromePowell, demanding aggressive rate cuts since taking office in January. Trump's Truth Social posts called for cuts "bigger than [Powell] had in mind" while openly threatening to fire the Fed chairman over monetary policy disputes.

Troubling economic indicators justified the dovish pivot, with job creation figures revised downward by a staggering 911,000 positions from initial reports. Unemployment rates climbed higher as economic growth decelerated sharply during 2025's opening months, triggering alarm among Federal Open Market Committee members about deteriorating employment conditions.

$BTC hovered around $116,000 immediately following the announcement, declining 0.6% over the previous 24-hour period. $ETH climbed modestly to $4,491 as cryptocurrency markets positioned for potential capital inflows from the enhanced #liquidity environment created by cheaper borrowing costs.

The FOMC delivered an 11-1 vote favoring the quarter-point reduction, with newly confirmed governor Stephen Miran as the sole dissenter advocating for a more aggressive 50-basis-point cut. Miran previously served as senior strategist at Hudson Bay Capital Management, an investment firm actively trading FTX bankruptcy claims, before his Federal Reserve appointment.

Historically, #Bitcoin demonstrates strong performance during low-interest-rate cycles as institutional investors abandon low-yielding traditional assets for higher-return alternatives.