Fed’s Third Rate Cut of 2024, Will It Revive XRP and BTC Prices?
As expected, on December 18, 2024, the Federal Reserve lowered the key interest rate by 25 basis points, which was the third consecutive interest rate cut so far in 2024. However, this rate cut announcement warns us that there will be further cuts in the coming years.
Fed cuts rates by 25 basis points
The decision officially lowered the federal funds rate from 4.50% to 4.25%. Although inflation remains slightly above the central bank’s target, it has fallen sharply from the 40-year high reached during the peak of the epidemic.
While the effects of this latest rate cut may not be immediately apparent, it marks a key step in the Fed’s broader effort to continue lowering interest rates for some time.
Despite expectations of a rate cut, the overall cryptocurrency market continued to decline following the Federal Reserve’s announcement. Furthermore, the overall cryptocurrency market shows no signs of price recovery.
Will the cryptocurrency market recover?
according to coin market capthe overall cryptocurrency market fell by 2.62%. In comparison, major cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Ripplethe price of Solana (SOL) fell by more than 2.65%, 2.30%, 4.69% and 5.15% respectively in the past 24 hours.
Judging from historical data, this interest rate cut is undoubtedly beneficial to financial markets, including cryptocurrency. However, Presto Labs research analyst Min Jung said the upcoming rate cut will have minimal impact on Bitcoin prices.
Some analysts further added that the recent rate cuts may support the recent price decline to recover soon and recoup the losses.
