Fed Vice Chair Urges Caution on Rate Cuts: Crypto Market Reacts

Federal Reserve Vice Chair Philip Jefferson emphasized a cautious approach to interest rate adjustments, citing economic uncertainty. His remarks align with other Fed officials advocating for measured policy decisions. The comments follow the FOMC's decision to keep rates steady at 4.25%-4.5%, after three consecutive cuts totaling one percentage point. While inflation has slowed, December’s 2.6% year-on-year rise remains above the Fed’s 2% target. Jefferson expects inflation to decline but remains cautious in his outlook.

Following his statement, the crypto market experienced mixed movements. Bitcoin saw volatility over the weekend, plunging from $104,000 to $91,178 before rebounding. It currently trades at $99,600, down 1.02% in 24 hours and nearly 10% below its all-time high of $109,114 set on Jan. 20, 2025. Ethereum dipped to $2,150 before recovering to $2,763, while Solana fell to $176 before rebounding to $203. Other altcoins, including Cardano, Tron, Avalanche, Shiba Inu, PEPE, and Algorand, posted gains between 1.75% and 7%.

Analyst Ali highlighted Bitcoin's critical support zone between $96,475 and $99,360. If this level holds, bullish momentum could push BTC higher, particularly if resistance at $102,350-$103,900 is breached.

The crypto market remains highly sensitive to macroeconomic developments, with traders closely watching Fed signals for future rate decisions.