Fed’s 25 BPS Rate Cut Sparks Crypto Rally Amid Liquidity Surge
The Federal Reserve delivered a widely anticipated 25 basis point rate cut, lowering the target range to 3.50–3.75%. Markets reacted swiftly: Bitcoin briefly topped $93,000, while the S&P 500 gained 0.8%. The Fed’s accompanying $40B/month Treasury bill purchases further fueled risk appetite.
Crypto markets celebrated the liquidity injection, though skeptics warned the rally could fade as fiscal deficits and potential Fed caution in 2026 loom. The FOMC noted cooling labor markets (unemployment at 4.2%) and ‘balanced’ risks—a subtle shift implying slower future easing.