Wall Street Divided on December Fed Rate Cut as Crypto Markets Watch Closely
Morgan Stanley has reversed its stance on a December rate cut, now forecasting the first reduction in January 2026 after September's stronger-than-expected payroll data. The firm projects three cuts next year, potentially bringing rates to 3.00%-3.25%.
Goldman Sachs maintains a contrarian view, citing rising unemployment and nearing 2% inflation as justification for a possible 25 bps December cut. "Labor market softness leaves the door open," said Goldman's Kay Haigh, highlighting the 4.4% unemployment rate - the highest since 2021.
The Fed's December 9-10 meeting looms as a pivotal moment for risk assets. cryptocurrency traders are monitoring the debate closely, as rate decisions typically trigger volatility across BTC, ETH, and altcoin markets. Historical patterns show crypto often rallies when liquidity conditions ease.
