Bitcoin surged 5% overnight, breaking $99,000! BCA Research: Three reasons the Fed will cut rates by more than 50 basis points next year.

Investment research firm BCA Research recently analyzed that although the Federal Reserve announced a continued rate cut of 25 basis points this month, it also projected a slowdown in the pace of rate cuts next year. However, due to the significantly lower-than-expected PCE data for November and the weak performance of the labor market, as well as potential economic policies after Trump takes office next year, it could lead to the Fed cutting rates by more than 50 basis points in 2025. (Background: The era of ultra-low interest rates ends; Trump holds the key to 2025 rate cuts) (Context: Stocks and currencies suffer! The Fed is expected to cut rates only by 50 basis points next year, and Tesla plummets 8% as U.S. stocks sink) Bitcoin delivered an early Christmas gift to investors last night (24th), starting a rapid rise around 20:45, breaking through multiple levels of resistance, and peaked at $99,480 at midnight. At the time of writing, it has slightly retraced to $98,405, with a nearly 5% increase over the past 24 hours. Ethereum also briefly broke through $3,500, and SOL rose above $200, with most mainstream altcoins rebounding under the influence of Bitcoin. Is market panic dissipating? We know that the decline over the past few days was mainly due to the Fed's rate cut of 25 basis points on the 19th of this month, indicating a slowdown in the pace of rate cuts in 2025, and only two 25 basis points cuts are expected next year, fewer than the four previously anticipated in September, triggering turmoil in the U.S. stock and cryptocurrency markets. Fed dot plot BCA Research: The Fed's rate cuts next year will exceed 50 basis points. However, recently, more and more analyses suggest that the Fed's rate cuts next year will be larger under controlled inflation. Investment research firm BCA Research recently released a report stating that they believe the actual rate cuts by the Fed next year will exceed the 50 basis points projected by officials during this month's FOMC meeting. BCA Research first pointed out that after the Fed's rate cut decision was announced this month, the November Personal Consumption Expenditures Price Index (PCE) released by the U.S. Department of Commerce brought good news. The November PCE index was significantly below market expectations, and if this trend continues in 2025, the Fed will likely take actions to cut rates by more than 50 basis points next year: The core PCE index is the Fed's preferred inflation indicator. If this indicator remains at the average level of the last three months, the annual inflation rate will indeed reach 2.5% by March next year; if it remains at the average level of the last six months, it will reach 2.5% by February. This indicates that inflation may achieve the Fed's forecast earlier than expected, even reaching levels below the Fed's predictions. On the other hand, BCA Research stated that the labor market is losing momentum, with the unemployment rate rising from a cyclical low of 3.4% to 4.2%. Therefore, the Fed's forecast of keeping the unemployment rate at 4.3% by year-end is questionable. BCA Research believes that under the premise that the labor market cannot receive significant boosts, the Fed may adjust the magnitude of rate cuts next year. Finally, BCA Research also analyzed the potential impact of tariff policies that Trump may implement after taking office next year, believing that tariffs may temporarily trigger a rebound in inflation, and the pressure on the manufacturing sector may force the Fed to accelerate the pace of rate cuts in the second half of next year. Related reports Bloomberg analyst: Bitcoin is just a normal correction! Matrixport is optimistic that $90,000-$95,000 is the bottom, preparing for an upswing in 2025. Bitcoin monthly demand surges, supply is tight; meme coin $WEPE pre-sale achieves great results. This Friday, the "largest scale ever" $14 billion Bitcoin options expire; beware of severe market fluctuations. "Bitcoin surged 5% overnight, breaking $99,000! BCA Research: Three reasons the Fed will cut rates by more than 50 basis points next year." This article was first published on BlockTempo (the most influential blockchain news media).