by Enoch Mwathwa
U.S. labor market growth has slowed to its weakest pace in months, intensifying calls for a September interest rate cut. Federal Reserve Governor Michelle Bowman is pressing the Federal Open Market Committee (FOMC) to act at its September 16–17 meeting to support employment and avoid deeper policy moves later in the year.
Labor Market Data Strengthens Rate Cut Case
July’s nonfarm payroll report showed an increase of only 73,000 jobs, far below expectations. Revisions to May and June figures confirmed weaker hiring trends, adding urgency to Bowman’s position.
Data from the CME FedWatch Tool shows an 88.9% probability of a rate cut in September. Historically, rate reductions have boosted liquidity and supported risk assets, including equities and cryptocurrencies.
Support Grows Within the Fed
Bowman and Governor Chris Waller were the only members advocating for a 25-basis-point cut in July. Since then, more policymakers have aligned with the idea. Minneapolis Fed President Neel Kashkari recently argued that it might now be time to cut rates, while San Francisco Fed President Mary Daly suggested as many as three cuts this year might be in order.
This developing consensus indicates a possible change from the Fed’s defensive pedigree of policy pedigree at the start of 2025.
Plan for Three Cuts in 2025
Bowman favors rate reductions at the Fed’s September, October, and December meetings. She believes a measured pace will balance the Fed’s dual mandate while addressing the slowdown in job creation.
She also dismissed concerns that new U.S. tariffs would drive inflation higher. Inflation remains on track toward the Fed’s 2% target, according to both Bowman and Chair Jerome Powell.
Crypto Market Monitoring Fed Actions
The cryptocurrency market is keen on the possibility of an interest rate reduction. The easing of monetary policy can stimulate investment in higher-risk assets, which is the possibility of stimulate the trading process in digital assets.
Analysts warn that other factors, such as world economic status and emerging regulations, would continue to affect the prices of crypto. Before deciding, traders are recommended to use only verified data on the markets and official statements of the Fed.
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