Fed cuts interest rate

The Federal Reserve System of the United States has reduced the federal funds rate by 25 basis points, setting it at the level of 4.5-4.75%.

While this decision was anticipated by the markets, the price of Bitcoin rose to an all-time high of $76,700.

Political influence

The rate cut occurred after Donald Trump’s victory in the elections. Although the president does not have direct influence over the Fed’s policy, this step aligns with his campaign promises and his desire to stimulate economic growth through lower interest rates.

It is known that Trump supports monetary policy easing, which has sparked active discussions regarding the Fed's independence.

Economic situation assessment

Fed Chair Jerome Powell stated that the decision is based on the latest data indicating stable economic growth, although the labor market is softening and inflation remains elevated.

The unemployment rate, which currently stands at 4.1%, is positively regarded by the Fed as a sign of stability. This shift in monetary policy has generated a positive response in financial markets, supporting Trump’s view on the importance of low rates for economic growth.