FOMC Cuts Rates Amid Economic Uncertainty, Altcoins in Focus

The Federal Reserve delivered its first rate cut of 2025, slashing borrowing costs by 25 basis points despite core PCE inflation lingering at 2.9%. Chair Jerome Powell framed the MOVE as preemptive support for a softening labor market, triggering an immediate dollar selloff and risk asset rally.

Policy divisions run deep at the Fed, with nine officials projecting at least two more cuts this year while six anticipate no further easing. The discord reflects growing stagflation concerns as unemployment holds NEAR 4.3%-4.5% and the 2026 inflation outlook ticks up to 2.6%.

Crypto markets typically thrive in loose monetary policy environments, with altcoins often outperforming Bitcoin during risk-on periods. The rate cut could accelerate capital rotation into smaller-cap digital assets as traders chase higher beta plays.