Recently, the question of when the Federal Reserve will cut interest rates has become a hot topic again. Philadelphia Fed President Anna Paulson recently signaled that if economic data remains stable, a moderate rate cut could be considered before the end of 2026. It sounds quite measured.

The Federal Open Market Committee(FOMC)'s forecast is more cautious—they believe there might be a 25 basis point cut in 2026. The current stance is basically watch and wait, with no immediate action planned. Decision-makers emphasize that they will adjust flexibly based on upcoming economic data.

Although this rate cut signal is mild, it still provides a boost to risk assets like cryptocurrencies and stocks. The reason is straightforward: a rate cut means liquidity will become more abundant, making it more attractive for funds seeking returns.

Interestingly, market expectations for the timing of the rate cut are being pushed further back. Previously, many guessed it would start around mid-year, but now it’s generally believed to be around the end of the year. This shift is worth noting for investors—every statement from the Federal Reserve could change the market rhythm.