Polymarket traders are betting on a Federal Reserve rate cut at the upcoming FOMC meeting, with a $10.9 million volume suggesting a 25 basis point reduction as the most likely outcome.
Bollywood Fever: Traders on the Polymarket platform are speculating that the Federal Reserve‘s upcoming Federal Open Market Committee (FOMC) meeting, scheduled for September 17-18, 2024, will result in a decrease in the federal funds rate.
This sentiment is reflected in a significant bet with a $10.9 million volume, where 77% of traders predict a 25 basis point cut as the most probable outcome.
Meanwhile, 21% anticipate a 50 basis point reduction, and a small 3% believe the Fed will maintain current rates.
Several factors are driving these expectations for a rate decrease, including a decline in inflation, which supports the case for lowering rates, and a weakening job market, suggesting a need for more supportive economic measures.
These expectations align with the Federal Reserve’s dual mandate to balance inflation control with economic growth.
While most analysts agree on a 25 basis point cut, there is speculation that a more substantial reduction could occur if economic conditions deteriorate significantly.
Analysts have also forecasted a decline in Bitcoin price volatility, as market participants brace for the anticipated start of a rate-cutting cycle by the Federal Reserve next month.
Polymarket has gained prominence in the crypto landscape over the past year, with traders using the platform to bet on various outcomes by leveraging crypto tokens to buy and sell shares.
The platform’s growing activity is evident from its cumulative volume, which surged from $1 billion in July to $1.52 billion by the end of August.
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