The latest data from Polymarket shows that the probability of the Federal Reserve cutting interest rates by 25 bps in December surged to 87%. This drastic increase reflects market expectations that the economic slowdown and inflation pressures are starting to ease, opening up opportunities for quicker easing.
If the interest rate cut does occur, the impact could be significant for the market:
– Liquidity increases
– Risk assets may strengthen
– The dollar could weaken
– Commodities like gold and crypto have the potential to rally
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