|
Getting your Trinity Audio player ready...
|
The global financial landscape has taken a sharp downturn since President Donald Trump’s April 3 reciprocal tariff declaration, sending shockwaves through major stock markets. The U.S. saw its worst two-day market performance since the COVID-19 crash of 2020, while Asian trading opened with China’s market plummeting over 5%—its largest one-day drop since 2008. European markets, including the UK and Germany, also slumped under growing economic uncertainty.
While the mood is grim across global equities, optimism is emerging in an unexpected quarter: the U.S. Federal Reserve. JPMorgan’s global head of fixed income, Bob Michele, believes a swift interest rate cut is likely, despite Fed Chair Jerome Powell’s cautious remarks. Speaking to Bloomberg, Michele pointed out that last week’s market crash joins only three other historical precedents—1987, 2008, and 2020—all of which were followed by immediate Fed intervention.
⚡️NEW: JPMorgan’s Bob Michele says the Fed may have to cut interest rates before the next meeting. pic.twitter.com/a2grBT7Kfa
— Cointelegraph (@Cointelegraph) April 7, 2025
Michele argues that the central bank may act before its scheduled May FOMC meeting, regardless of Powell’s reserved stance during a recent event in Arlington. There, Powell emphasized patience, suggesting the Fed will first assess the economic impact of tariffs before adjusting policy to meet inflation targets.
Michele isn’t alone. Former President Trump, a vocal Bitcoin advocate, has also urged the Fed to reduce rates, saying it would be a strategically sound move for the economy.
For Bitcoin, this could be a game-changer.
The flagship cryptocurrency has dipped 8% amid the broader market slump. However, historical patterns suggest that rate cuts—via lower borrowing costs—boost investor appetite for riskier assets like Bitcoin. Reduced interest rates typically fuel liquidity, often triggering crypto rallies.
BitMEX co-founder Arthur Hayes concurs, forecasting a parabolic Bitcoin rally if the Fed intervenes, with a bold $250,000 target by year-end.
Also Read: XRP Price Set for 30% Surge as JPMorgan Predicts $6B Inflows from ETFs
As traditional markets teeter, crypto investors may find opportunity in the chaos—if the Fed pulls the trigger on a rate cut.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
