Cuts in interest rates in 2025 would boost the assets considered «risk». Trump demands that the Fed lower the rates, but Powell resists complying with the presidential «order». The financial markets of shares and cryptocurrencies remain expectant to the decision made by the Federal Reserve (FED), a US Central Bank, this Wednesday, May 7, 2025 on interest rates. Although there is a broad consensus that interest rates will remain unchanged, the tone offered by the president of the agency, Jerome Powell, in the subsequent speech could influence market behavior. Since January, rates remain in the range of 4.25% to 4.5% after three consecutive cuts in the previous months. According to the survey of CME Group expectations, there is hardly a 1.8% chance that the Fed will establish a new reduction on this occasion.
Interest rates in the United States since 2000. Source: Investing. The president of the FED, Jerome Powell, has indicated that there is no urgency to modify monetary policy. In his words, the economy remains «strong in general», with a «solid» labor market, which reinforces the probability that rates remain unchanged. By June 18, the decision that follows, the probability of a cut increases to 25%, and for the next, on July 30, rises to 75%, according to the CME. This in view of the fact that the Fed, in March, maintained its projection to make two reductions of interest rates this year.
The Fed does not show intention to lower the soon tile fees despite Trump
Although President Donald Trump has publicly stated that he sees rates cuts as soon as possible to avoid a recession, the Fed maintains a strategy of «waiting and seeing.» This position It seeks to gain time to evaluate how the effects of the commercial measures carried out by the government are manifested in the economy. As cryptootics has reported, the Trump government advances in international negotiations on import tariffs after the pause that established for this measure. This has led to a rebound in the markets, after the fall that passed before the tariff announcements that generated fears of inflation and recession. Despite the fears of greater inflation in the United States, it has dropped for the second annual consecutive month, according to the consumer price index published in April. «The data were solid enough to allow the Federal Reserve to remain on the sidelines while monitoring the impact of tariffs and inflation expectations,» said Nancy Vanden Houten, the main economist for the United States of Oxford Economics. Douglas Porter, chief economist of BMO Capital Markets, indicated that the agency «will remain awaiting more information about how the tariff clash is spreading through the labor market and global supply chains.»
Bitcoin and actions slow down their impulse to caution
The closeness of this type of ads usually brings greater prudence among the operatorswhich can translate into caution movements of prices, even down. In tune with this, both the stock markets and Bitcoin opened the week with a brake on the upward trend that the previous one had experienced, as seen below.
BTC prices and the SPX stock index in 2025. Source: TrainingView. Normally, Rate decisions usually generate high volatilityeven if they remain unchanged, due to the message that Powell provides in his subsequent speech. When it offers an optimistic look for the economy, markets tend to react with consolidation or upward. Otherwise, they must respond down. The attention of investors, therefore, is not only put in the decision itself, but on the signs that may arise on the next steps of the Central Bank in the middle of an economy that continues to show mixed signs.
Bitcoin, anyway, is showing greater strength than stock marketshaving recovered prices more than two months ago after falling to a minimum of four months. To put in comparison, the S&P 500 (SPX), on the other hand, recovered levels of only one month ago after falling to no -year quotes. Currently, BTC quotes around USD 94,000, which is 13% below the historical maximum of USD 109,300 that registered three months ago, on January 20, on Trump's presidential assumption day. With this behavior, hopes that Bitcoin reactivates the tendency to new record prices, with an increase in liquidity in the year driven by rate cuts. However, in the short term, this could be delayed depending on the Fed decision.