#CPIWatch #TrumpTariffs citic Securities, one of China's largest investment banks, has released a forecast on the Federal Reserve's rate path, suggesting a slowdown in the easing cycle early next year.
⏸️ The January Pause & Two Remaining Cuts
Citic Securities anticipates that the Federal Reserve will pause its interest rate cuts in January 2026.
The report suggests that during the current period, there are two remaining 25 basis point (bps) cuts to be delivered under the current expected policy cycle, both of which are under the chairmanship of Jerome Powell.
This implies:
Imminent Cuts: The market can likely expect the total rate cuts to equal 50 basis points from the present moment (likely across the December 2025 and an early 2026 meeting).
January Break: The break in January suggests the Fed wants to assess the impact of previous cuts and wait for new economic data (especially inflation and jobs reports) before continuing the easing cycle.
💥 Crypto Market Impact
Temporary Relief: Confirmation of two more 25 bps cuts is generally dovish news and supports risk assets like Bitcoin ($BTC), as lower rates increase liquidity.
The Pause Concern: The anticipated pause in January could trigger volatility, as traders often sell on uncertainty. If the pause is extended, it means less easy money in the system, potentially capping major rallies.
Powell's Tenure: The mention of "two remaining meetings chaired by Jerome Powell" adds a geopolitical layer, linking the monetary policy outlook to the end of his term and potential uncertainty over the next Fed Chair nomination, a theme which Citic Securities has previously highlighted as a future market driver.
Trader Action: While two more cuts are generally positive, the market remains fixated on the pace of easing. The prospect of a January pause means smart traders should lock in gains and prepare for heightened volatility around the New Year.
