[Market] December rate-cut probability nears 70%… Bitcoin below 87K

Suehyeon Lee

Summary

CME FedWatch reported that the probability of a December rate cut was 69.4%.
The market places weight on the possibility of the first policy rate cut at year-end and said it also reflects the possibility of two cuts by January 2025.
Bitcoin was reported to be trading at $86,369.58 after recovering to the $88,000 level and then falling.

According to the CME FedWatch at the Chicago Mercantile Exchange (CME), the probability of a rate cut in December is nearing 70%, while Bitcoin (BTC) continues to trade sideways.

On the 24th, the CME FedWatch tool showed a 69.4% probability that the Federal Reserve (Fed) will cut the policy rate by 25bp in December. Conversely, the probability of keeping rates unchanged was calculated at 30.6%, with the market placing greater weight on the possibility of the first rate cut by year-end.

Expectations for cumulative rate cuts through January next year have also strengthened. FedWatch data showed a 56.9% cumulative probability of a 25bp cut by the Federal Open Market Committee (FOMC) meeting in January 2025, a 20.8% probability of rates remaining unchanged, and a 22.3% cumulative probability of a 50bp cut. This indicates the market is treating one cut as likely and is partly pricing in the possibility of two cuts.

Meanwhile, Bitcoin briefly recovered to the $88,000 level this morning before falling again and is currently trading at $86,369.58, up 1.6% from the previous day according to CoinMarketCap. Ethereum (ETH) also fell below $2,800 and is trading at $2,779.50, up 0.04% from the previous day. XRP is trading at $2.03, up 4.51% from the previous day. Solana (SOL) is trading at $130.22, up 1.82% from the previous day.