CME FedWatch, a tool measuring market expectations for interest rate changes by the Federal Reserve, has just adjusted the forecast for the probability of a rate cut in December to 76.2%, a significant increase compared to previous estimates.

On December 3rd, this tool recorded an increase of 10.2 percentage points compared to 66% on November 29th. Accordingly, the market predicts that the Fed will announce a 0.25% rate cut, bringing the target interest rate range down to 4.25%-4.5% at the meeting held on December 17-18.

Currently, the Fed's interest rate is maintained at around 4.5%-4.75%, after two cuts totaling 0.75% this year, from the highest level in over two decades.

Rate cuts: A positive signal for Bitcoin

Fed rate cuts typically have a positive impact on Bitcoin. The reason is that low borrowing costs often encourage investors to shift towards riskier assets, including cryptocurrencies.

CME FedWatch tracks the probability of interest rate changes through 30-day futures contract data related to the Fed's interest rates.

The forecast for the possibility of an interest rate cut increased significantly after Fed Governor Christopher Waller's remarks at a monetary policy conference in Washington, D.C., on December 2nd. Waller stated, “At the moment, I lean towards supporting a cut.” However, he also noted that the final decision will be based on new data regarding employment, consumer spending, and inflation released before the meeting.

Waller further stated that this data will play a crucial role in deciding whether the Fed should cut interest rates or keep them unchanged.

Meanwhile, Federal Reserve Bank of New York President John Williams, speaking at an event in New York, said he expects rates to decrease 'over time,' but did not affirm whether he would support a cut at the upcoming meeting.

Fed Chairman Jerome Powell previously stated that there are currently 'no signals indicating the need to rush to cut rates.' He is expected to provide a new perspective on this issue at a public event in New York on December 4th.

Bitcoin and year-end outlook

Alongside interest rate forecasts, Bitcoin continues to attract attention as its price has more than doubled since the beginning of the year, driven by optimistic sentiment in the U.S. market. This partly stems from Donald Trump's victory, who pledged to reform crypto regulations.

Currently, Bitcoin is trading around $96,000, up about 0.3% in the past 24 hours. However, many analysts expect Bitcoin to reach $100,000 before the end of 2024.

Source: https://tapchibitcoin.io/xac-suat-fed-cat-giam-lai-suat-trong-thang-12-tang-len-762-fedwatch.html