What a violent rollercoaster of a day it has been for BTC.
The massive volatility in the cryptocurrency markets continues as Bitcoin rebounded by more than $3,000 after falling below $81,000 to mark a new seven-month low just an hour ago.
The most obvious reason behind this immediate increase is related to the US Federal Reserve. New York Chapter President John Williams brought some are hoping for a return to a rate cut horizon, indicating that the central bank can indeed cut them “in the short term.”
While he admitted that inflation’s progress has “temporarily stalled,” he believes there is a way for the Fed to cut rates again soon and also aim for the long-term 2% target.
“I view monetary policy as modestly restrictive… Therefore, I still see room for further near-term adjustment to the target range for the Federal Funds Rate to bring the policy stance closer to the neutral range, thereby maintaining the balance between achieving our two objectives,” he concluded.
His comments came after reports claiming the central bank might not cut interest rates at its December meeting due to delayed economic data for October and November.
The odds on Polymarket also showed the recent changes, as the no-rate cut option had risen to over 60% in recent days. However, after Williams’ speech, the tables were turned, and now the option for a 25 basis point cut has risen to 62%.
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