Federal Reserve's Rate Cut Backlash: The Fed's widely anticipated 25-basis-point cut yesterday (to 4.25–4.50%) was meant to ease borrowing costs and support risk assets. However, it triggered a reassessment of future liquidity: markets now see fewer aggressive cuts ahead (only ~40% odds for December), signaling persistent inflation and a cooling labor market.
$BTC dropped below $90,000 as traders rotated out of high-volatility assets like crypto into safer bets. As Blueprint Finance CEO Nic Roberts-Huntley noted, while the cut "boosts risk-asset sentiment," crypto's reaction was "cautious" due to hawkish undertones in Fed Chair Powell's remarks on "stagflation risks."
This "sell the news" dynamic wiped out $437 million in leveraged positions in the last 12 hours alone.
