Bitcoin News Today: Investors Redirect $7.4T as Fed Eases Rates to Spur Growth

The U.S. Federal Reserve's roadmap for monetary policy in 2025 is increasingly clear, with analysts and market indicators pointing to two additional rate cuts before year-end. Recent inflation data, corporate guidance, and liquidity shifts are fueling expectations that the central bank will ease borrowing costs to bolster growth amid slowing economic momentum.

The Fed's September 2025 decision to cut its key rate by 25 basis points-to a range of 4.00%-4.25%-was a pivotal step, signaling a data-dependent approach to further easing. This followed a 12-month inflation rate of 3% as of September, up from 2.9% a year prior, according to the Bureau of Labor Statistics and a Livemint report. While inflation remains above the Fed's 2% target, labor market softness and weak manufacturing data have heightened calls for additional stimulus.

Markets are pricing in 150-200 basis points of rate cuts through 2026, with the potential for a December 2025 reduction already factored into asset prices, according to a Coinpaprika analysis. The prospect of lower rates is driving a $7.4 trillion liquidity surge from money market funds into risk assets like stocks and Bitcoin. Money market funds, which hold $7.39 trillion in assets, could see yields drop below 4% as rate cuts progress, prompting investors to reallocate capital toward equities and bonds. Historical precedents, such as the $500 billion shift into risk assets during the 2009 recovery, suggest similar dynamics could propel market indices higher.

The immediate impact is evident in Wall Street's reaction. On October 24, the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all opened sharply higher as traders bet on the Fed's dovish trajectory. Equities rallied further on optimism about corporate earnings, with tech giants like Microsoft and Amazon preparing to report results amid the rate-cut backdrop, according to an Investors Business Daily preview. Even companies facing near-term headwinds, such as Ford-which revised its 2025 profit forecast downward due to supply chain disruptions-saw shares jump on investor confidence in long-term recovery plans, according to Finimize.

Bitcoin, too, is positioned to benefit. Spot ETF inflows hit $26 billion in 2025, with BlackRock's IBIT alone attracting $100 billion in assets, the Coinpaprika analysis notes. Analysts speculate that a 5% shift of money market fund capital into crypto could push Bitcoin toward $280,000-$350,000, though bonds and equities are likely to absorb the bulk of the liquidity first.

The Fed's policy pivot is also reshaping global financial landscapes. In Japan, the launch of JPYC, the country's first yen-denominated stablecoin, underscores how central banks and private firms are adapting to lower-rate environments, as reported by Cointelegraph. Meanwhile, U.S. regulators are scrutinizing synthetic stablecoins like Ethena's USDe, which has challenged USDC's dominance but faces volatility risks highlighted by a recent depeg event in a CoinEdition report.

As the Fed prepares its next move, markets will closely watch November's meeting and the Trump-Xi summit for clues about trade tensions and inflation trajectories, observers note. With rate cuts seen as a near-certainty, the focus shifts to how capital will flow-and where the next economic catalysts will emerge.

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