10x Research: If Interest Rates Cut by 50 Basis Points Next Week, it Could Trigger Risk-Off Sentiment and Put Pressure on Risky Assets to Rise
ChainCatcher News: 10x Research Warns of Potential Negative Impact on Risk Assets if Fed Cuts Rates by 50bps
According to Coindesk, 10x Research believes that a 50 basis point (bps) rate cut by the Federal Reserve on September 18th could negatively impact risk assets, including cryptocurrencies, despite the initially bullish sentiment surrounding an easing liquidity cycle.
A 50bps adjustment typically signals an urgency to control inflation, triggering risk aversion in financial markets. A 50bps cut next week could signify heightened economic concerns or a feeling of lagging behind in addressing the impending economic slowdown, leading investors to reduce exposure to risk assets like Bitcoin (BTC) and stocks.
"While a 50bps rate cut by the Fed could signal increased market concern, the Fed's primary focus will be on mitigating economic risk rather than managing market reactions," said Markus Thielen, founder of 10x Research.
