ING's Forecast for Federal Reserve Rate Cuts in 2026
ING Group has forecasted that the Federal Reserve will implement two rate cuts in 2026, a divergence from the Fed's current projections. The bank's economists anticipate 25 basis point reductions in both March and June, suggesting a dovish shift in monetary policy. Economic factors such as weakened wage growth and a smoother decline in energy prices are expected to align inflation with the Fed's target sooner.
Historically, these conditions often lead to increased liquidity in financial markets, positively influencing cryptocurrency valuations. Following ING's announcement, economic analysts have noted the potential benefit for risk assets like Bitcoin and Ethereum, which tend to perform well when interest rates fall. Macro-crypto analysts echoed that continued rate cuts may boost market sentiment for BTC and ETH.
"We expect inflation to decline faster than the Fed anticipates, leading to two additional cuts in 2026." James Knightley, Chief International Economist, ING Group
Crypto Market Outlook Amid Anticipated Rate Changes
In periods of rate cuts like 2019 and 2020, Bitcoin saw a significant increase in price, emphasizing how macroeconomic policies can trigger bullish trends in crypto markets.
Bitcoin is currently priced at $89,681.34 with a market cap reaching approximately 1.79 trillion USD, holding a market dominance of 58.53%. Over the last 24 hours, BTC's trading volume was 68.38 billion USD, despite a general downtrend, dropping by 2.97% within that period.
Analysis indicates that the predicted rate cuts might stimulate a positive shift in crypto investment, encouraging flows into BTC and ETH. Potential regulatory adjustments catering to increased crypto institutionalization could further strengthen this outlook.