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Fed rate cut chances drop significantly

Likelihood of Federal Reserve rate cuts in September has fallen to 43%, impacting market sentiments.

July 31, 2025 at 03:02 PM

September Fed rate cuts odds drop to 43%

The likelihood of Federal Reserve rate cuts in September has decreased, adding to market uncertainty.

Fed rate cut odds decline amid market volatility

The chances of Federal Reserve rate cuts in September have fallen to 43%, a notable drop from over 63% prior to the recent Fed meeting. This shift reflects traders reassessing their previous optimistic expectations. Following this news, Bitcoin momentarily decreased to $115.7K. Fed Chair Jerome Powell’s comments on inflation risks and a cautious approach contributed to this market reaction. He emphasized the need for further evaluation of the economic landscape before making any policy adjustments. Currently, the consensus is leaning towards maintaining steady rates, with the expectation of a 25 basis point cut receding.

Key Takeaways

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Fed rate cut odds declined to 43% from over 63%.

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Bitcoin briefly dipped to $115.7K after Fed comments.

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Powell's cautious outlook reflects ongoing inflation concerns.

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Rising Bitcoin profitability raises risk of profit-taking.

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Crypto strategist suggests a possible rebound if the Fed pivots.

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Market sentiment is shaped by macroeconomic conditions.

"For the time being, we’re well-positioned to learn more about the likely course of the economy and the evolving balance of risks before adjusting our policy stance."

This statement from Fed Chair Jerome Powell reflects the uncertainty surrounding future monetary policy adjustments.

"A Fed pivot could serve as a major tailwind. Looser financial conditions and rate cuts have historically fueled risk assets."

Matt Mena highlights the potential benefits of a dovish shift in Fed policy on cryptocurrency markets.

The drop in Fed rate cut expectations signals growing market anxiety. Even as Bitcoin shows some resilience, overall sentiment is cautious. Investors are weighing the implications of a strong dollar and high Bitcoin profitability on future price movements. The recent surge in unrealized profits for Bitcoin could lead to profit-taking, potentially limiting its upward trajectory. If the Fed pivots towards a dovish stance, it may rejuvenate investor confidence in riskier assets like cryptocurrency. Watching the macroeconomic indicators will be crucial as they could greatly influence investor strategies in the coming weeks.