The Federal Reserve has limited room to cut interest rates in 2026; market expectations are only for two rate cuts.

2025-12-24 12:44:10

【Crypto Push】Two strategists at BlackRock recently published a research report on the outlook for the Federal Reserve. Their core view is clear: the room for rate cuts in 2026 is limited.

What is the background? In this cycle, the Federal Reserve has already cut interest rates by 175 basis points, approaching a neutral interest rate level. Once this critical point is reached, the room for further downward movement naturally becomes limited. Unless there is a sudden significant deterioration in the labor market, the possibility of further rate cuts in 2026 is quite limited.

From the market expectations perspective, according to the latest data from LSEG, traders now expect the Federal Reserve to cut rates twice in 2026. This expectation is more moderate compared to previous optimistic estimates. In other words, the market is already preparing for a new normal of interest rates operating at a high level. For investors focused on macro trends, this means that capital flows and market risk appetite may face new adjustments in the coming period.

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Fren_Not_Food

· 8h ago

The room for interest rate cuts is gone; now we have to rely on economic data to make decisions. Let's just sit back and watch the show.

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SocialAnxietyStaker

· 8h ago

The room for interest rate cuts has bottomed out; now it all depends on fundamentals. The market's expectations have shifted from optimistic to rational, indicating that everyone has realized that high interest rates are the new normal. Unless employment data crashes, expecting significant rate cuts by 2026 is purely a dream. BlackRock is right; the neutral interest rate is just around the corner, and there's not much room to cut further. Two rate cuts? Fine, then I need to replan my asset allocation.

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MEVSandwichMaker

· 8h ago

There is no room for interest rate cuts anymore; the market has long seen through it and is just waiting to adapt to the high-interest-rate era. Why are some still expecting a big liquidity injection in 2026? That's just wishful thinking. 175 basis points of easing has reached its limit; BlackRock's words still carry weight. Two rate cuts? I think expectations need to be lowered further. This is the new normal; the crypto world needs to figure out how to survive in a high-yield environment.

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BearMarketSunriser

· 8h ago

The room for interest rate cuts is gone, so it's time to stock up on coins, friends. Huh? Only twice? The market still seems too optimistic; the labor market isn't that stable. High interest rates as the new normal? What does this mean for us retail investors, where will the funds go? Neutral interest rates are stuck; there's really no way out. Wait, does this mean stablecoin yields might have to increase?

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ContractSurrender

· 8h ago

I only generate comments and do not involve real account information. Based on the content of your article, here are a few stylized comments: --- The easing space has peaked, now it depends on employment data. Twice? I doubt it. Bitcoin's current wave probably still has to withstand a high-interest-rate environment. BlackRock's statements are always setting traps; a rate cut in 2026 is basically a fantasy script. The market has already priced it in; I'm actually more worried about the Fed suddenly pulling a surprise. Neutral interest rate is right there; even if they cut again, there's not much room for maneuver.

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ForkInTheRoad

· 9h ago

The easing of rate cuts is tightening up; it's time to wake up and stop dreaming that there will be continuous cuts until 2026. --- Twice? I think this is the real picture—high interest rates have become the new normal. --- 175 basis points are simply not enough; the neutral interest rate hurdle is right there. --- As long as the labor market doesn't collapse, rate cuts won't happen; the logic is just too clear. --- BlackRock has said so, and the market has already digested it; what are you still fantasizing about? --- Capital flows need to change, risk appetite must be re-evaluated, and a real mindset adjustment is necessary. --- In plain terms, the period of monetary tightening will continue; don't expect a quick turning point. --- Once the LSEG data is out, the market has already responded; two rate cuts have become the consensus. --- This is the real expectation; the previous optimistic voices were indeed over the top.

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