Bitcoin Braces For Fed Decision As Polymarket Traders Bet On A 0.25% Cut

Group 1 - The future of Bitcoin is closely tied to the Federal Reserve's decision on September 17, with markets anticipating around 30 basis points of easing [1] - Futures indicate a high probability of a quarter-point cut, with a growing chance of a larger 50 basis point reduction, which could drive Bitcoin towards all-time highs [1] - Data from CME Group's FedWatch tool shows a nearly 90% probability of a 25 basis point reduction and about a 10% chance of a 50 basis point cut [1] Group 2 - Polymarket's prediction market suggests an 82% chance of a 25 basis point cut and a 15% chance of a 50 basis point cut [2] - Recent U.S. labor figures were revised down by 911,000 jobs through March 2025, marking the steepest adjustment since 2009, indicating weakening economic momentum [3] - Inflation readings are mixed, with core CPI at 3.1% in August and core PCE at 2.9% in July, leading to a balanced policy debate [3] Group 3 - Treasury markets reflect expectations of easing at the short end, while longer maturities are influenced by term premium and fiscal dynamics [4] - Reuters polling indicates a steeper yield curve into year-end, with two-year yields projected near 3.40% and 10-year yields around 4.25%, creating a spread close to 85 basis points [4] - Even after a potential cut, policy rates would remain above the Cleveland Fed's neutral estimate of 3.7% [4] Group 4 - Upcoming data releases, including CPI on September 11 and retail sales on September 16, could influence the decision between a 25 basis point and a 50 basis point cut [5] - Bitcoin briefly reached $124,000 in mid-August due to easing bets, keeping traders attentive to changes in dollar direction, real yields, and Fed communications [5]