Altcoins Spike: Fed Rate Cut Hint Fuels Crypto Rally

Altcoins Rally on Potential Fed Rate Cut

Altcoins experienced a significant rally during U.S. trading hours on Tuesday afternoon, spurred by comments from Treasury Secretary Scott Bessent regarding a potential Federal Reserve rate cut.

Bessent suggested the Federal Reserve should consider a 50 basis point rate cut at its upcoming September meeting, stating, "The real thing now to think about is should we get a 50 basis-point rate cut in September." He also claimed the Fed could have cut rates in June if it had access to more accurate economic data.

Market Reaction

While a 25 basis point rate cut was already largely factored into market expectations, the possibility of a more aggressive 50 basis point cut appears to have provided additional impetus.

Analyst Perspective

It's important to note that Bessent, while influential, is not a member of the Federal Reserve. However, given his role in advising the President on Fed appointments, his statements carry weight.

Altcoin Performance

The positive sentiment extended beyond Bitcoin, with several altcoins posting substantial gains:

• Ether (ETH): Increased by nearly 9% over the past 24 hours, exceeding $4,600 for the first time since November 2021.
• Cardano (ADA): Gained approximately 8% over the last 24 hours.
• Solana (SOL): Advanced by around 8% over the same period.
• Litecoin (LTC): Increased by about 8% in the last 24 hours.
• XRP (XRP): Experienced a 3.5% increase.

Bitcoin and Broader Market Impact

While altcoins led the charge, Bitcoin remained relatively stable at $120,000. The overall rally also boosted equity markets by more than 1%, with the U.S. dollar weakening against major currencies.

Underlying Factors

The rally began earlier on Tuesday, following the release of consumer price data for July that aligned with expectations, further solidifying the positive market sentiment.