Fed’s Bostic Signals Single Rate Cut in 2025

What to know:
  • Bostic expects one rate cut in 2025 due to tariffs.
  • Impact on crypto: cautious sentiment, limited upside.
  • Fed policy influences risk asset performance globally.
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Fed’s Bostic Signals Single Rate Cut in 2025

Bostic Foresees Single 2025 Rate Cut Amid Tariffs

Atlanta Federal Reserve President Raphael Bostic has expressed expectations of a single interest-rate cut in 2025. This comes amid concerns over tariff-induced inflationary pressures. Bostic, though not a voting member in 2025, plays a vital role in shaping discussions. He stated, “For me right now, I’m expecting it’s going to take a bit longer for that to sort out. … I’m leaning much more into one cut this year, because I think it will take time, and then we’ll sort of have to see” (Scotsman Guide).

Positioning himself for a slower economic outlook, Bostic anticipates the U.S. economy will slow but not slip into recession this year. The decision narrows earlier projections of two cuts as tariff concerns solidify their hold on monetary policy.

Cryptocurrencies Face Pressure Under Tight Fed Policy

Potential rates indicate less monetary easing, supporting stronger dollar expectations. Cryptocurrencies, like BTC and ETH, are expected to face downward pressure under tightening conditions due to reduced liquidity.

Cryptocurrency markets, affected by interest rate outlooks, may see stagnant growth in DeFi protocols. Investors adjust risk shedding, impacting the speculative inflows critical for growth in digital assets and tokens.

Past Fed Cycles Show Crypto Volatility Reduction

Past Fed cycles, such as 2018 and 2022, showed reduced crypto volatility and downside potential under rate pause or limiting environments. Risk assets like BTC historically react with price corrections or stability during tighter policy periods.

With implied sustained inflationary challenges, long-term prospects for digital assets remain sensitive. Analysis suggests prolonged limited upside without clarity on future rate intentions.

Disclaimer: The information on this website is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency markets are volatile, and investing involves risk. Always do your own research and consult a financial advisor.

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