Three Cuts, Bitcoin at $200K? What’s at Stake in the Fed’s September Meeting

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The debate over U.S. interest rate cuts may reach a turning point at the upcoming Federal Reserve meeting on September 16-17, 2025. Markets are betting that the Fed could deliver as many as three cuts this year, starting with a possible 50 basis point reduction next week.

Three Rate Cuts in the US?

Analysts from major financial institutions forecast that the Fed will cut rates by 0.25% (25 basis points) in September. Then it will be followed by an additional 25-basis-point cut in December and possibly another either late this year or early next year.

Paul Barron explained the odds of three rate cuts. He reviewed the Polymarket odds of the Fed’s decision in September, which show a larger “jumbo” cut of 50 bps with odds of 17.5%. It also predicts a 25 bps increase and a 25 bps decrease with 80% and 0.3% possibility, respectively.

Additionally, new polls and market indicators are also showing a rising probability for a sizable rate reduction at the next meeting.

What Are The Experts Saying

The American economist, Mohamed A. El-Erian, said he believes in the possibility of a rate cut this year. In an interview with CNBC, he said, “We’ve seen this movie before; we saw it a year ago, where they refused to cut in July, and they did a jumbo cut of 50 basis points in September.”

“I think this time around the risks to the economy are higher than they were a year ago, because we’ve eroded the financial Security of lower-income households,” he added.

It has also been indicated that these rate cuts will address the hurdle in job growth and maintain economic momentum, like the inflation concerns.

Tom Lee’s Prediction on Rate Cut

The Wall Street strategist Tom Lee commented in an interview that rate cuts typically benefit risk assets such as Bitcoin and Ethereum. He also said that if the cycle of Fed cuts eases, then Bitcoin will potentially double to $200,000 by the end of the year.

But on the other hand, the Indian American author Ruchir Sharma says this is a bad time to cut the rates. He believes financial conditions are already too easy, and the U.S. economy has a massive budget deficit that could be problematic. He says, without high rates, this move could trigger risks, encouraging a market overreaction to any sign of economic slowdown.