2026 Rate Cut Path Emerges as Key Variable for Crypto Market, Fed Disagreement Intensifying

By: theblockbeats.news|2025/12/31 10:16:17
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BlockBeats News, December 31st, the Federal Reserve has cut interest rates three times in 2025, bringing the rate to 3.5%–3.75%, but it is still at an 18-year high. The latest dot plot shows officials are deeply divided on the 2026 rate path: views on "zero, one, or two rate cuts" are almost evenly split, with rising market uncertainty.


CME data shows a rate cut probability of only 20% in January, rising to 45% in March. Most predictions point to a rate cut in 2026 or just one.


Analysts believe that if employment weakens and inflation remains under control, there may be 1–2 rate cuts during the year, which would benefit risk assets; conversely, if inflation rebounds, rate cuts along with liquidity support or a pause would put pressure on the stock market and the crypto market. Additionally, Powell's stepping down in May and the potential appointment of a dovish new chair are also seen as key variables affecting the crypto market in 2026.

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