77% of Polymarket Traders Expect 25 Basis Point Cut in Federal Reserve's FOMC Meeting

CryptoNews.com

2024-09-03 02:52:53

Bitcoin fed rate cut Polymarket

The bet also indicates a 21% chance of a more substantial 50 basis point cut. Last updated:

September 3, 2024 06:52 EDT

Author

Ruholamin Haqshanas

Author

Ruholamin Haqshanas

About Author

Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto…

Author Profile

Copied

Last updated:

September 3, 2024 06:52 EDT

Why Trust Cryptonews With over a decade of crypto coverage, Cryptonews delivers authoritative insights you can rely on. Our veteran team of journalists and analysts combines in-depth market knowledge with hands-on testing of blockchain technologies. We maintain strict editorial standards, ensuring factual accuracy and impartial reporting on both established cryptocurrencies and emerging projects. Our longstanding presence in the industry and commitment to quality journalism make Cryptonews a trusted source in the dynamic world of digital assets. Read more about Cryptonews The majority of traders on Polymarket are betting on a reduction in the federal funds rate as the Federal Open Market Committee (FOMC) meeting, scheduled for September 17-18, approaches.

Data from the decentralized betting platform shows that 77% of traders expect a 25 basis point cut, reflecting a strong consensus on this outcome.

The bet, which has seen a trading volume of $10.9 million, also indicates a 21% chance of a more substantial 50 basis point cut, while only 3% of traders believe the rate will remain unchanged.

Key Economic Indicators Drive Rate Cut Anticipations

The anticipation of a rate cut is driven by several key economic indicators.

A decline in inflation and a weakening job market are fueling expectations that the Federal Reserve may take action to provide more economic support.

These factors are in line with the Fed’s dual mandate to control inflation while promoting economic growth.

Odds of a 50+ bps rate cut just tripled. pic.twitter.com/m29EkytvRl

— Polymarket (@Polymarket) August 2, 2024

While most analysts agree on the likelihood of a 25 basis point cut, they also note that a more significant reduction could be considered if economic conditions deteriorate further.

Recently, at the Jackson Hole symposium, Fed Chair Jerome Powell said that the “time has come for” the US Federal Reserve to cut interest rates.

According to Investec economist Lottie Gosling, very weak data could make a 50 basis-point rate cut more likely, and on the other hand, strong data could rule out a bigger cut.

“Even though Powell refused to comment on whether the door could be open to a 50 basis-point [rate] cut in September, we do suspect that a further clear deterioration in the labor market could steer the FOMC into more aggressive easing,” he commented.

Additionally, analysts predict a decline in Bitcoin price volatility as markets prepare for a potential rate-cutting cycle by the Federal Reserve.

Bloomberg to Integrate Polymarket Election Odds into Terminal

As reported, leading financial data and news service provider Bloomberg LP is set to incorporate election odds data from the crypto betting platform Polymarket into its widely used Terminal.

Polymarket, a blockchain-based prediction market operating on the Polygon network, has become a prominent platform for tracking real-time election odds.

The platform allows users to bet on a wide range of event outcomes, leveraging transparent on-chain data and smart contracts for trade ution and payouts.

According to Dune Analytics, Polymarket’s trading volume for August approached $450 million, with nearly $760 million bet on the outcome of the U.S. presidential election as of late August.

Last month, five United States Senators and three House representatives called for a ban on betting activities linked to the upcoming 2024 presidential election.

The bipartisan group consists of prominent figures such as Senators Jeff Merkley, Richard Blumenthal, Elizabeth Warren, and Representatives Jamie Raskin and John Sarbanes, among others.

The group expressed concerns over the possibility of billionaires leveraging large wagers to sway election outcomes, thereby eroding public trust in the democratic process.

BTC-0,29%

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.