Cryptocurrency market stages recovery on prospects of federal interest rate cut

(MENAFN) Yesterday, the cryptocurrency market staged a significant recovery, driven by renewed optimism surrounding potential interest rate cuts by the US Federal Reserve. This sentiment followed the release of the central bank's preferred inflation indicator reading last Friday, which fueled expectations of monetary easing to combat inflationary pressures.

The recovery in cryptocurrency prices was particularly supported by the CME FedWatch tool, which indicated a 63 percent probability of a Fed rate cut at the upcoming September meeting, up from 50 percent just a month ago. Bitcoin, the leading cryptocurrency, saw a notable uptick, climbing 4.16 percent to trade at USD63,402. This surge comes as Bitcoin aims to recover from a 7 percent loss it incurred in June.

Similarly, Ethereum showed strong performance, rising by 3.77 percent to reach USD3,498, while Binance Coin increased by 2.81 percent to USD585. Cardano also joined the upward trend, gaining 4.74 percent to trade at USD0.3996.

Investors and traders in the cryptocurrency market closely monitored these developments, interpreting them as indicators of potential easing measures by the Fed to support economic growth amidst inflation concerns. The positive market reaction underscored the sensitivity of cryptocurrencies to macroeconomic factors, especially monetary policy decisions from major central banks like the Federal Reserve. 

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