This is an extremely critical week for the US market. The Federal Reserve is expected to announce a 25 basis point rate cut on December 18. The event is expected to have an impact on the cryptocurrency market. The upcoming rate cut is the second rate cut in 2024.
Here is what you should know. Fed's interest rate decision: what you should know In September, the Federal Reserve launched the first rate cut in 2024 and subsequently lowered the interest rate target to a range of 4.75% to 5%. The weak job market mainly prompted the Fed to make a quick rate cut decision. The initial jobless claims index fell from 260,000 to 242,000 in the industry week in October.
On December 18, the Federal Reserve may announce a second large rate cut of 25 basis points. CME gives a probability of at least 93.4% for a rate cut of 25 basis points. The impact of the Federal Reserve's rate cut on cryptocurrencies Since the federal rate cut in September, the entire cryptocurrency market has increased by 71.77%; in particular, the market capitalization of all cryptocurrencies except the top ten has soared by at least 87.16%. In October and November, the Bitcoin market grew by 11.2% and 37.4%, respectively.
While the Ethereum market recorded a negative performance of -3.16% in October, the market recorded a positive performance of 47.4% in November. Experts believe that the upcoming rate cut will also have a positive impact on the cryptocurrency market. The past 24 hours have seen positive changes across the market. Bitcoin and Ethereum grew by 2.3% and 1.9%, respectively, during this period. Major economic events that cryptocurrency investors should not miss On Thursday, December 19, the final value of the US GDP growth rate and the final value of the US core PCE prices will be released.
In the first quarter, GDP growth was only 1.6%. In the second quarter, it grew to 3%. This time, the market generally believes that the index will fall further to the 2.8% range. TEForcast also supports this consensus. In the first quarter of 2024, the PCE price index was 3.7%. It fell to 2.8% in the second quarter. This time, the market generally believes that the index will fall to 2.1%.
TEForcast also made the same prediction. In conclusion, this week is crucial for both the U.S. economy and the cryptocurrency market. With the Fed's interest rate decision and key economic indicators such as GDP and PCE prices about to be released, these events may shape the market trajectory.
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