- Rate cut probability at next FOMC meeting jumps to 87%
- Soft PPI data signals slowing inflation
- Markets react positively, expecting bullish momentum
Markets Brace for Rate Cut as Odds Hit 87%
The probability of an interest rate cut at the upcoming FOMC (Federal Open Market Committee) meeting has surged to 87%, sending a strong bullish signal across financial markets. This sharp rise in expectations comes on the heels of fresh Producer Price Index (PPI) data that confirmed a continued cooling in inflation.
The softer-than-expected PPI figures indicate that inflationary pressures are easing faster than anticipated—giving the Federal Reserve more room to pivot toward monetary easing. For investors, this is a green light: cheaper borrowing, higher risk appetite, and potential upside across equities and crypto.
PPI Data Seals the Deal for Fed Pivot
The Producer Price Index, which measures inflation at the wholesale level, is often a leading indicator of consumer inflation trends. The latest data came in lower than forecasted, aligning with recent CPI softness and pointing toward a slowing economy rather than an overheating one.
This confirmation has shifted market sentiment quickly. Traders and analysts now overwhelmingly expect the Fed to cut rates at the next FOMC meeting, ending the aggressive tightening cycle that defined much of the last two years.
As a result, risk assets like stocks, crypto, and gold have started pricing in a looser policy environment—a dynamic that typically supports price growth and investment flows.
Bullish Momentum Builds Across Markets
An expected rate cut is generally seen as bullish across risk markets, especially when combined with easing inflation. For the crypto space in particular, lower rates tend to boost liquidity and investor appetite, driving capital toward high-growth assets like Bitcoin , Ethereum , and altcoins.
With the FOMC meeting just weeks away, all eyes will be on whether Fed Chair Jerome Powell confirms the market’s pricing. But with 87% odds already baked in, markets are clearly betting that the era of high rates is coming to an end—and bulls are getting ready to run.
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