BiyaPay analyst: As Fed rate cuts draw near, JPMorgan outlines three scenarios
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BiyaPay analyst: As Fed rate cuts draw near, JPMorgan outlines three scenarios
The Federal Reserve is about to announce a key interest rate decision, with the market widely expecting a rate cut to be certain. JPMorgan has outlined three possible market reaction scenarios: Scenario 1: A 25-basis-point rate cut with a dovish stance—this is the most likely outcome, with a probability of 47.5%. After the cut, the S&P 500 may rise in the short term but could face a 5% pullback by month-end due to the "sell-the-news" effect. In this case, tech and biotech stocks could present buying opportunities. Scenario 2: A 25-basis-point rate cut accompanied by hawkish commentary—this scenario has a 40% probability. If the Fed cuts rates but delivers hawkish remarks, the S&P 500 might drop 0.5%. Growing concerns about the economic outlook could trigger a short-term correction. Scenario 3: A 50-basis-point rate cut—this scenario carries a 7.5% probability. If the Fed cuts rates by 50 basis points, the S&P 500 could experience two-way volatility of 1.5%. The market may interpret this as a sign of deeper concern over the labor market, leading to sell-offs. Amid such heightened uncertainty, cryptocurrencies like Bitcoin could emerge as safe-haven assets, attracting more capital inflows. Meanwhile, BiyaPay offers investors 0-fee cryptocurrency trading services and supports using USDT to trade U.S. and Hong Kong stocks, enhancing flexibility and efficiency in cross-market investments and helping investors navigate market volatility.
Navigating Web3 tides with focused insightsTechFlow news, September 17 — The Federal Reserve is about to announce a key interest rate decision, and the market widely expects a rate cut to be certain. JPMorgan has outlined three possible market reaction scenarios:
Scenario One: 25 basis point cut with a dovish stance
This is the most likely outcome, with a probability of 47.5%. After the rate cut, the S&P 500 may rise in the short term, but could face a 5% pullback by month-end due to the “buy the rumor, sell the news” effect. In this case, technology and biotech stocks might present buying opportunities.
Scenario Two: 25 basis point cut accompanied by hawkish rhetoric
This scenario has a 40% probability. If the Fed cuts rates but delivers hawkish comments, the S&P 500 could decline by 0.5%. Increased market concern over the economic outlook may trigger a short-term correction.
Scenario Three: 50 basis point cut
This scenario has a 7.5% probability. If the Fed cuts rates by 50 basis points, the S&P 500 could experience two-way volatility of 1.5%. The market may interpret this as a sign of deeper Fed concern about the labor market, potentially triggering a sell-off.
Amid rising uncertainty, digital currencies such as Bitcoin may emerge as safe-haven assets, attracting more capital inflows. Meanwhile, BiyaPay offers investors zero-fee cryptocurrency trading services and supports USDT for trading U.S. and Hong Kong stocks, enhancing flexibility and efficiency in cross-market investing and helping investors navigate market volatility.
