Mon, September 16, 2024 at 10:31

• 

  Kang-hoon

  • Hello, Annie.

  • Today, I want to discuss the upcoming September Fed meeting, which is set to take place this week between September 17 and 18.

  • 
• Annie

  • Oh, interesting!😊 What can we expect from this meeting?

  
• 

  Kang-hoon

  • The US Federal Reserve is expected to announce an interest rate cut at its press conference on September 18.

  • The market odds show a likelihood of a 25 or 50 basis points (bps) cut.

• Annie

  • Wow, that's a significant development!

  • What are the chances for each scenario?

  
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• 

  Kang-hoon

  • According to CME FedWatch data, there's a 59% chance of a 50 bps cut and a 41% chance of a 25 bps cut.

  • Polymarket data shows similar probabilities.

• Annie

  • I see.

  • Have these odds changed recently?

  
• 

  Kang-hoon

  • Yes, until last week, the odds favored a 25 bps cut.

  • However, the recent PPI inflation data indicated an improved US economy, increasing the possibility of a higher rate cut.

• Annie

  • This would be the first rate cut since March 2020, right?

  
• 

  Kang-hoon

  • Correct.

  • The crypto community is closely monitoring this event, as it will significantly impact Bitcoin and other crypto assets.

  • Historically, BTC has benefited from rate cuts.

• Annie

  • How did Bitcoin react to the last rate cut in March 2020?

  
• 

  Kang-hoon

  • The March 2020 rate cut kickstarted the 2021 bull run, with Bitcoin rising to around $69,000.

• Annie

  • That's impressive!

  • What are analysts predicting for Bitcoin if a rate cut happens this time?

  
• 

  Kang-hoon

  • Crypto trader and analyst Doctor Profit expects BTC to face downward pressure initially.

  • He also mentioned that the Israel-Lebanon conflict could add fear to the market, causing further declines.

  • 
• Annie

  • So, it sounds like there might be some volatility.

  • What should investors do?

  
• 

  Kang-hoon

  • Doctor Profit advises market participants to apply proper risk management and protect their capital during these volatile times.

• Annie

  • Got it.

  • What about the mid and long-term outlook for Bitcoin?

  
• 

  Kang-hoon

  • Doctor Profit remains bullish on Bitcoin's mid and long-term outlook.

  • He predicts that the inevitable flood of money printing will boost liquidity in the crypto market.

• Annie

  • That sounds promising!

  • What other factors could influence this liquidity?

  
• 

  Kang-hoon

  • The amount of USDT issued on-chain is rising, and FTX creditors could start receiving repayments from Q4 of this year, further injecting liquidity.

• Annie

  • Interesting.

  • Are there any more rate cuts expected after this meeting?

  
• 

  Kang-hoon

  • Yes, Citi analysts predict a 1.25% Fed rate cut this year, indicating that more rate cuts are likely after the September meeting.

• Annie

  • Thanks for the detailed explanation, Kang-hoon.

  • So, would you say this news is a positive development for the market?

  
• 

  Kang-hoon

  • Yes, I would consider this a positive development.

  • Despite short-term volatility, the long-term outlook for Bitcoin and the broader crypto market appears bullish due to increased liquidity and potential further rate cuts.

  • Upon comprehensive consideration, this news is perceived as a 😍Bullish.