Wall Street made a big mistake: Fed strategy changed, decline came
While world markets are focusing on the Fed's interest rate decision, which will be announced tomorrow at 9 pm ET, markets that expect around 6 to 8 interest rate cuts for 2024 at the beginning of the year cannot even predict what the institution will do in the remaining part of the year. All this uncertainty brought serious declines in cryptocurrencies and stocks.
Just a few months ago, it was discussed whether the Fed would reduce interest rates in March 2024 or even "definitely" start reducing interest rates in May. However, the US financial world, in other words Wall Street, is now unsure whether the Fed will cut even 2 interest rates after regular and consecutively high inflation data.
Market declines continue
The Fed's inability to permanently reduce inflation below 3 percent and geopolitical tensions in the world make it difficult to predict what the Fed will do. This uncertainty also brought significant declines in Bitcoin and altcoins, as well as US stocks. Interest rates in the USA are still at their highest level in 22 years.
There is a high probability that it will be fixed tomorrow
The Fed interest rate decision, which will be announced tomorrow evening, does not create much excitement in the markets because it is considered certain that the institution will keep the interest rates constant between 5.25% and 5.5%. However, what is really important here is what Jerome Powell will say at the press conference to be held after the decision. Powell's words on when interest rate cuts may come will determine the course of the markets.
