Will the Third Rate Cut Happen This Month?

Federal Reserve officials appear divided on the pace of rate cuts. Governor Christopher Waller has hinted at a gradual 25-basis-point cut, pointing to a cooling labor market and manageable inflation. In contrast, Governor Mester favors larger and faster cuts, arguing that economic growth is slowing and risks are building.

What the Data Suggests
Recent indicators show that hiring has slowed, wage growth is flattening, and participation in the workforce remains weak. Inflation, while easing slightly, is still above the Fed’s target. The central bank now faces the challenge of balancing inflation control with the need to support economic momentum.

My Take
It seems highly possible that the third rate cut of the year could happen this month, most likely a 25-basis-point move. The Fed may choose a cautious approach to avoid market shock while still showing commitment to stabilizing growth. However, if economic data continues to weaken, a larger cut cannot be ruled out.
Overall, this decision could be a major turning point for both traditional markets and crypto. A smaller cut might steady investor sentiment, while a bigger one could trigger a short-term rally as traders price in easier monetary conditions.
The next Fed decision could shape the tone for the rest of the year — will they play it safe or go bold?
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