Bitcoin opened the week with a sell-off to $63,000, and the intra-day trend was not impacted by United States Federal Reserve Chair Jerome Powell’s statement that additional rate cuts were part of the Fed’s plan. Despite the correction, Bitcoin price remains on track to close Q3 with positive returns.
On Sept. 30, Bitcoin fell from a high of $65,634, dropping approximately 4% to an intraday low of $63,049, according to data from Cointelegraph Markets Pro and TradingView. At the time of publication, Bitcoin price was exchanging hands at $63,344, down 3.6% over the last 24 hours.
Following a speech at the National Association for Business Economics in Nashville, Powell said that upcoming interest rate cuts will not be as aggressive as the recent 50-basis-point decrease.
The Fed chair explained that if the economy moves as expected, markets should expect two more rate cuts in 2024, but they would be 0.25% increments.
“This is not a committee that feels like it’s in a hurry to cut rates quickly.”
“Looking forward, if the economy evolves broadly as expected, policy will move over time toward a more neutral stance. But we are not on any preset course. The risks are two-sided, and we will continue to make our decisions meeting by meeting,” Powell added.
Powell’s remarks come less than two weeks after the Federal Open Market Committee (FOMC) cut interest rates by 50 basis points, the first since March 2020.
Futures market forecasts are indicating that the Fed is more likely to move cautiously during its next meeting in November and approve a quarter-point reduction. However, traders see the December move as more aggressive. Data from CME Group’s FedWatch Tool puts the odds of a 0.5% rate cut at the Dec. 18 FOMC meeting at around 48%.
Prior to the remarks, markets expected the FOMC to reduce interest rates by a further 0.5% at its next meeting.
Bitcoin traders still expect a bullish Q4
Powell’s remarks come after major cryptocurrencies notched a third consecutive week of gains. Bitcoin had a rough start to what is historically the most bearish month for BTC, dropping 11% between Sept. 1 and Sept. 6. However, the price rebounded after the Fed cut interest rates by 50 basis points after its FOMC meeting on Sept. 18.
Data from CoinGlass shows Bitcoin’s price on track to finish Q3 0.6% higher and 7% higher in September.
“100% of election years had a green October, November and December,” said Quinten François, co-founder of WeRate, in a Sept. 30 post.
“100% of the years with a green September had a green October, November and December. Q4 starts tomorrow.”
