CoinVoice has learned that the Federal Reserve announced a scheduled interest rate cut of 25 basis points on Wednesday, but significantly raised future policy rate and inflation expectations, now expecting only two rate cuts next year totaling 50 basis points, halving the previous forecast.
According to 4E monitoring, after the Federal Reserve's dot plot and economic outlook were released, risk aversion sentiment surged sharply, causing all three major US stock indexes to decline. The S&P 500 index fell by 2.95%, the Dow Jones dropped by 2.58%, marking its longest losing streak since 1974 with ten consecutive days of decline, while the Nasdaq fell by 3.56%. Tesla dropped over 8%, leading the decline among tech giants. Cryptocurrency-related stocks fell across the board, with MSTR down 9.52% and Coinbase down 10.2%.
The Federal Reserve's actions have led to a crash in the US stock market, triggering a significant correction in the cryptocurrency market. BTC fell below $100,000, and Powell's remark that 'the Federal Reserve does not allow and has no intention of holding Bitcoin' intensified market sell pressure, with Bitcoin plunging by as much as 6.2%, currently reported at $99,235 before publication. Ethereum briefly dipped to $3,542, a decline of 7.27%, while altcoins generally saw double-digit declines. In the past 24 hours, the total amount of liquidations in the cryptocurrency market reached $842 million, deepening market panic.
In the foreign exchange commodities sector, the Federal Reserve drastically cut interest rate expectations, causing the US dollar index to rise over 1% to a two-year high; gold prices fell over 1% to a one-month low; a decrease in US crude oil inventories pushed US oil prices higher, but the slowdown in interest rate cuts dampened oil demand prospects, leading to a gradual retreat in oil prices after a brief surge.
After announcing a rate cut of 25 basis points to 4.25%-4.5% as expected, the Federal Reserve's published 'dot plot' indicates only two more rate cuts by 2025, a reduction in planned rate cuts compared to the September dot plot, with hawkishness exceeding expectations, leading to extreme market fear. Fed officials also expect two more rate cuts in 2026 and one more in 2027. [Original link]
