A recent report from centralized exchange (CEX) Blofin highlights a cautiously bullish sentiment among crypto investors, even as macroeconomic indicators and global market conditions continue to inject a degree of precaution into the market. Market Anticipates Limited Fed Rate Cuts According to the firm’s analysis, one significant factor influencing market sentiment is the surprisingly positive Consumer Price Index (CPI) data for September, which has altered expectations regarding future interest rate cuts by the US Federal Reserve (Fed). Currently, the market anticipates that the Fed will implement a total of only 45 basis points (bps) in rate cuts for the remainder of the year.
Notably, tail risk pricing has been on the rise since the end of September. Related Reading: Crypto Analyst Predicts Giga Pump’ For XRP Price, Here’s The Target Overall, this trend reflects investors’ concerns about potential "extreme negative events,” underscoring that, despite the recent rally seen in the crypto market, uncertainties surrounding future Fed rate cuts and broader macroeconomic conditions continue to weigh heavily on sentiment.
Moreover, the options market suggests that there may be just one additional rate cut in 2024, likely a 25 bps reduction, followed by a pause in early 2025. Related Reading: Solana Extends Rally By 4%, But This Factor Could Lead To A Top This outlook aligns with prior analyses by Blofin, which indicate that the Fed’s capacity for further cuts has diminished, indicating a shift from aggressive liquidity injections to a more measured approach.
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