The Federal Reserve is now expected to cut interest rates at its March Federal Market Opening Committee (FOMC) meeting by more than 23% of market participants, up from just 18.4% a few days ago.
The change in sentiment comes amid market concerns over the nomination of Kevin Warsh as the new Fed Chairman.
Kevin Warsh, who was nominated by President Donald Trump to replace Jerome Powell, is seen as a hawkish figure, meaning he favors keeping interest rates higher for longer and reducing liquidity in the financial system.
This view has caused concern among investors, including the crypto and risk-on assets markets.
However, some traders believe the Fed may still make a small 25 basis point cut to ease market pressure. There is no expectation of a more aggressive rate cut so far.
The Fed’s interest rate policy plays a key role in market movements.
Loose liquidity typically has a positive impact on risky assets like crypto, while tight monetary policy can depress prices when capital flows are limited.
For now, the market remains cautious, with investors continuing to assess the direction of the Fed's policy and its impact on the global economy and the crypto market.
