Federal Reserve Cuts Rates Amid Internal Division

2 mins mins

Key Points:

Federal Reserve cuts interest rates amid internal division.
Concerns over ongoing inflation and labor markets.
Market participants react to Fed’s cautious stance.

The Federal Reserve has implemented a third consecutive 25 basis point interest rate cut, targeting a 3.50–3.75% range, amid rising divisions and persistent inflation concerns.

Internal disagreements and economic pressure complicate further rate cuts, affecting markets and echoing past monetary policy challenges like the 1970s stagflation period.

Fed’s 25 Basis Point Cut Amidst Internal Discord

The Federal Reserve announced a 25 basis point rate cut, a decision complicated by internal disagreements among FOMC members about the best path forward. The decision reflects continuing concerns over current economic conditions.

As the committee reduced rates for the third time, key economic indicators such as inflation and employment present a complex scenario. While some members support more aggressive cuts, others favor a more cautious approach, leading to a divided stance on future rate changes.

Responses from market participants indicate uncertainty. Economic commentators, including Jonathan Pingle of UBS, outlined the importance of supporting data in swaying members towards additional cuts. He stated, “As rates approach neutral levels, each rate cut loses more support from participants, and you need data to motivate those participants to join the majority for a rate cut.” The current approach highlights existing divisions and the role data will play in future decisions.

Market Dynamics Shift as Bitcoin Faces 19% Decline

Did you know? During the 1970s, a similar policy dilemma led to entrenched inflation, a situation the current Federal Reserve is determined to avoid by adopting a cautious approach, despite easing pressures.

According to CoinMarketCap, Bitcoin (BTC) is priced at $92,515.97 with a market cap of $1.85 trillion. Despite recent rate cuts, BTC experiences a 19.19% decline over 90 days. Market dominance stands at 58.42%, highlighting its pivotal role amid ongoing fiscal policy shifts.

bitcoin-daily-chart-4931 — Bitcoin(BTC), daily chart, screenshot on CoinMarketCap at 22:02 UTC on December 10, 2025. *Source: CoinMarketCap*

The Coincu research team highlights potential longer-term shifts in crypto market dynamics, as ongoing Federal Reserve policies influence macroeconomic conditions. Continued cautious monetary easing could temper rapid crypto gains, aligning with historical trends observed during past fiscal rate changes.

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