99% Fed Rate Cut Odds Fuel XRP Rally
Markets now price in over a 99% chance of a Fed rate cut at the September 17 FOMC meeting, up from around 90% a week ago. Traders expect the federal funds target to fall from 4.25–4.50% to 4.00–4.25%.
Lower borrowing costs and a softer dollar could channel liquidity into risk assets, especially XRP. The token’s sensitivity to monetary easing was clear last September, when a Fed rate cut preceded a 500% rally. With near-certainty of the Fed rate cut, traders are positioning for another XRP upswing, driving higher trading volumes and capital inflows as traditional yields wane.
Bullish
The near-certain Fed rate cut signals an increase in liquidity and lower yields on traditional assets, encouraging capital rotation into risk-on instruments like XRP. In the short term, this dynamic is likely to spur immediate buying pressure, driving up trading volumes and price momentum. Historical precedent—namely the 500% XRP rally following a September 2024 rate cut—underlines the token’s sensitivity to monetary easing.
Over the medium to long term, sustained lower interest rates could maintain a supportive framework for crypto, though the full impact may moderate as markets adjust to the new rate environment. Nevertheless, the combination of easy monetary policy, a weaker dollar, and renewed risk appetite points to a bullish outlook for XRP in the coming weeks.