The US Federal Reserve Cuts Interest Rates by 0.5%

Krutika Adani

Unusually Large Cut

On 18 September 2024, the US Federal Reverse released its FOMC meeting details, in which the council agreed on a 0.5% rate cut, larger than the expected 0.25%.

Impact on the Markets

Crypto markets reacted with strong price growth, lifting the crypto market cap from $2.06 trillion to $2.15 trillion. Bitcoin regained $62k levels, while Ethereum crossed $2400. The largest gainer was POPCAT, with a 29% gain.

Despite Decent Jobs and Inflation Data

The US Federal Reserve made the rate cut despite a 2.5% inflation rate in the last month (Aug) and improved job data ( non-farm unemployment at 4.2%).

How Will Markets Receive This

The markets have been expecting a 0.25% rate cut. The current 0.5% cut has lifted market sentiments from extreme fear to a neutral zone.

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