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A summary of the minutes of the Fed’s November meeting was released Tuesday, with Fed officials expressing confidence that inflation is falling and that future interest rate cuts could be gradual.
The Fed minutes said future interest rate cuts were likely, but would occur “gradually.” The minutes were related to the Federal Reserve’s latest policy meeting earlier this month, in which it cut its benchmark rate by a quarter point, from 4.50% to 4.75%. .
“In discussing the outlook for monetary policy, participants predicted that if the data were roughly as expected, with inflation continuing to fall sustainably to 2 percent and the economy remaining near peak employment, it would be probably appropriate to gradually move toward a higher policy-neutral employment rate over time,” the minutes said.
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The central bank began lowering the federal funds rate in September and the next meeting of the Open Market Committee is scheduled for December 17-18.
The crypto market reacts
Cryptocurrencies rose in early Wednesday trading as investors assessed the latest Federal Reserve meeting minutes and key economic data expected this week.
Bitcoin climbed to $93,000 after falling to a two-day low of $90,742 during Tuesday’s trading session.
Several crypto assets rose, including XRP (6%) and Cardano and Stellar up 10%. Aave and Algorand were up 13%, while Zcash was up 23%.
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The minutes were released a day ahead of key inflation data, the Personal Consumption Expenditure Price Index for October, which will be announced on Wednesday. The PCE is the Fed’s preferred inflation index and it informs monetary policy choices.
A series of economic data is expected to be released on Wednesday, ahead of Thanksgiving on Thursday, when markets will be closed. Traders expect a 66% chance that the Fed will cut rates by a quarter point at its next December meeting, and 33% expect no change.
