Bitcoin Price and Market Reactions Amid Anticipation of Federal Reserve Rate Cut
Bitcoin hovered around $90,000 with the price at $90,227 (−0.8%), while Ether was at $3,109 (+0.3%), XRP at $2.07 (+0.1%), and the total crypto market capitalization stood at $3.16 trillion (−0.8%).
MSCI Asia Pacific ex-Japan declined about 0.2% as Korea, Japan, and Australia benchmarks opened lower. US stock futures showed mild gains, yet the S&P 500 slid 0.3% on Monday. Australian 10-year government bond yields increased ahead of an upcoming policy decision.
The Federal Reserve is widely expected to announce a 25 basis-point rate cut this week. However, there is debate in markets regarding the pace of future easing amid limited economic data during a government shutdown. Money markets now price in only two more cuts by the end of 2026, reduced from three previously.
Inflation remains high, and data gaps have contributed to divisions within the Federal Reserve. Higher long-term yields and a stronger US dollar are seen as limiting risk appetite despite the start of a rate-cut cycle.
Derivatives pricing indicates about an 89% probability of a 25 basis-point cut on Wednesday, with expectations for further easing being trimmed.
Asian equities and cryptocurrency markets are influenced by policy signals from Beijing and Washington. China is focusing on domestic demand for 2026 with a cautious stimulus approach, potentially affecting regional risk appetite.
Commentary on policy stresses that no fixed path for rates is set: a former Federal Reserve chair candidate opposes pre-committed plans, while a White House adviser emphasizes data-driven, meeting-by-meeting decisions.
Crypto traders view the coming days as pivotal for year-end market sentiment. Amberdata's Greg Magadini suggested the Federal Open Market Committee (FOMC) decision could trigger a crypto rally if rate cuts are confirmed and extended through year-end. Additionally, former President Trump is expected to announce a Federal Reserve chair nominee in early 2026.
Santiment data reveals a continued removal of Bitcoin from exchanges, with about 403,200 BTC moved off exchanges in the past year. This represents a 2.09% reduction in Bitcoin's total supply.
