The US Fed announced a rate cut of 25 basis points early this morning, marking the second consecutive rate cut since September, lowering the benchmark interest rate to 4.5% to 4.75%, as expected. This allowed the US stock market and Bitcoin to maintain their upward momentum. Notably, this decision was agreed upon by all officials, indicating that the Fed indeed believes it is necessary to cut rates to avoid potential economic recession, pointing out that the unemployment rate in the labor market has risen but remains low.

According to the statement, the Fed believes recent economic indicators show that economic activity continues to expand steadily. Labor market conditions have eased, with a slight rise in the unemployment rate but still at a low level. Meanwhile, the inflation rate is gradually moving towards the 2% year-on-year target but is still slightly above the ideal level. In response, the Fed stated it will strive to achieve full employment and a long-term inflation target of 2% to ensure a soft landing.

The Fed believes that economic risks have remained balanced over the past year. Given the uncertainty in the economic outlook, the Fed decided to lower the target range for the federal funds rate by 25 basis points. Whether further adjustments will be made in the future will depend on the latest economic data, changes in outlook, and risk balance. The committee will also continue to reduce its holdings of US Treasuries, agency bonds, and mortgage-backed securities (MBS). After the US rate cut, Bitcoin continued to rise, with prices momentarily exceeding $76,000.