Key Insights
- A major crypto news is that the odds of a Fed cut in December are falling on Kalshi and Polymarket.
- Some Fed officials have expressed concerns about the rising inflation.
- The other key crypto news will be on the open interest and altcoin ETF approvals.
The crypto market remained on edge today, Nov. 6, as the recent Bitcoin price lost momentum. Bitcoin price was trading at $103,000, down from Wednesday’s high of over $104,000. One major crypto news driving the narrative is on the Federal Reserve, as odds of a rate cut in December plummet.
Crypto News Today: Odds of Federal Reserve Cuts Fall
Bitcoin and the broader crypto market pulled back last week after the Federal Reserve delivered its October interest rate decision, which was in line with expectations.
Jerome Powell and members of the Federal Open Market Committee (FOMC) decided to cut interest rates by 0.25% as concerns about the labour market remained. They also hinted that the bank will end its quantitative tightening policies in December.
However, Powell’s statement sent shockwaves through the financial market, as he did not commit to cutting interest rates at the December meeting, as most analysts had expected. He pointed to the country’s inflation, which has remained above the 2% target for over four years.
As a result, Polymarket data shows that the odds of the bank cutting interest rates by 0.25% in the upcoming meeting dropped from over 90% last week to 65%.
The odds of a Fed cut dropped after more officials warned about the dangers of cutting rates in a time when inflation remains resilient.
The most hawkish official has been Jeff Schmid of Kansas City, who votes against last week’s cut. In his statement, he argued that the economy was still performing well and that a rate cut was unnecessary, as it would likely push inflation higher.
Still, some Fed officials have expressed concerns that the labour market risks are outweighing the inflation risks. Lisa Cook, the embattled Fed governor, said that she will support another rate cut in the coming meeting. Stephen Moran, the newest Fed official, has also supported higher rate cuts.
US Economic Data Sending Mixed Signals
The most recent private sector data shows that the economy is sending mixed signals. For example, a report by ADP on Wednesday showed the private sector added 42,000 jobs as it returned to growth after shedding 32,000 in the previous month.
Another report by S&P Global and the Institute of Supply Management (ISM) showed that the services sector is doing relatively well, with the PMI remaining above the expansion zone of 50. However, a similar report released earlier this week revealed that the manufacturing sector remains in a contraction zone.
Still, there is a likelihood that the Fed will cut interest rates in December, as a 65% is still big enough. Such a move will benefit the crypto market as the industry thrives in a low-interest-rate environment.
Most importantly, the bank will likely deliver more cuts next year, as Donald Trump is expected to replace Jerome Powell when his term ends in June. His potential nominee will be in favor of cutting rates, as Stephen Moran has demonstrated. Such a move will reduce the likelihood of a liquidity crisis that could harm the industry.
Other Top Crypto News to Watch
There will be other potential crypto news that will impact the industry in the near term. One of the most important trends will be the use of leverage in the crypto industry.
One reason for the recent crypto market crash was the decline in futures open interest, which fell from over $300 billion in September to $140 billion this week.
Now, there are signs that open interest is rising, which is an indicator of the growing demand and use of margin.
The other key crypto news will be on the potential approval of altcoin ETFs. The Securities and Exchange Commission has already approved spot ETFs for Solana, Hedera, and Litecoin, and there are odds that it will approve many others in the coming weeks, which will boost the industry’s performance.
Crispus is a distinguished Financial Analyst at, bringing over 12 years of expertise in cryptocurrency markets, specializing in Bitcoin and altcoins. Renowned for his sharp insights at the nexus of market trends and breaking news, Crispus delivers actionable analysis to empower investors. His work is prominently featured across leading platforms, including BanklessTimes, CoinJournal, HypeIndex, SeekingAlpha, Forbes, InvestingCube, Investing.com, and MoneyTransfers.com, cementing his reputation as a trusted voice in the financial world.
