Will Powell Cut Rates This Week? Macro Analyst’s Top 3 FOMC Crypto Predictions – US Shutdown Warning?

Group 1: Federal Reserve and Economic Conditions - The cryptocurrency market anticipates that Fed Chair Jerome Powell will continue to cut rates, with futures markets indicating a 95% chance of a quarter-point rate cut at the end of the month, a significant increase from previous weeks [1] - The US government shutdown has halted the Bureau of Labor Statistics, resulting in the cancellation of the September jobs report and key spending data, leaving the Fed to operate without fresh data [2] - The unemployment rate has risen to 4.3%, the highest since 2021, with private payroll data indicating 32,000 job losses in September, suggesting a stagflation environment [5] Group 2: Market Reactions and Predictions - The current economic sentiment among US adults is largely negative, with 74% describing conditions as "fair or poor," indicating a lack of confidence in the economy [4] - There is speculation that deeper rate cuts from Powell may not occur until significant layoffs happen, which could lead to defaults on consumer debt [3] - Bitcoin is experiencing increased long-term holder accumulation, with exchange outflows rising by 9% week-over-week, reflecting growing investor conviction [6] Group 3: Asset Class Performance - Gold prices have reached $3,900, and the Nikkei index has climbed 4.3% due to expectations of Japan's fiscal stimulus, positioning Bitcoin as a third safe haven alongside gold and stocks [7] - Total value locked (TVL) in decentralized finance has increased to $82.5 billion, up 11% from the previous month, with Ethereum and Solana leading in inflows [6]