“The Federal Reserve’s megaphone” issues a warning: long-term interest rates may not be as low as everyone thinks!⚠️
On September 17, Nick Timiraos pointed to a change worth paying close attention to: when the Fed began cutting rates two years ago, policymakers still had clear disagreements about where the terminal rate would ultimately land; now, there are very few officials who believe long-term rates will be below 3%.
The latest projections are even more interesting: the Fed’s September SEP shows that the median long-term federal funds rate has risen to 3.2%, up from 3.1% in June; the median rate for 2029 reaches 3.6%.
In plain terms, the market has long assumed that after the U.S. starts cutting rates, rates will eventually return to a relatively low level. But now, more and more signals suggest that the future “normal rate” could be higher than people previously imagined.
This also matters for the crypto market. If interest rates remain elevated for the long term, it means global liquidity will be unlikely to be as loose as it was in the low-rate era. For BTC, ETH, and other high-valuation risk assets to keep strengthening, they must face higher funding costs.
**What’s truly worth关注 is not just whether the next rate cut happens—but whether the U.S. can return to a low-rate era in the coming years.** If the long-term rate center of gravity keeps moving up, the valuation logic for global assets may gradually change too. Follow me, and I’ll keep breaking down in plain language the logic behind the Fed, liquidity, and the crypto market.$SYN $ONE $LSK
On September 17, Nick Timiraos pointed to a change worth paying close attention to: when the Fed began cutting rates two years ago, policymakers still had clear disagreements about where the terminal rate would ultimately land; now, there are very few officials who believe long-term rates will be below 3%.
The latest projections are even more interesting: the Fed’s September SEP shows that the median long-term federal funds rate has risen to 3.2%, up from 3.1% in June; the median rate for 2029 reaches 3.6%.
In plain terms, the market has long assumed that after the U.S. starts cutting rates, rates will eventually return to a relatively low level. But now, more and more signals suggest that the future “normal rate” could be higher than people previously imagined.
This also matters for the crypto market. If interest rates remain elevated for the long term, it means global liquidity will be unlikely to be as loose as it was in the low-rate era. For BTC, ETH, and other high-valuation risk assets to keep strengthening, they must face higher funding costs.
**What’s truly worth关注 is not just whether the next rate cut happens—but whether the U.S. can return to a low-rate era in the coming years.** If the long-term rate center of gravity keeps moving up, the valuation logic for global assets may gradually change too. Follow me, and I’ll keep breaking down in plain language the logic behind the Fed, liquidity, and the crypto market.$SYN $ONE $LSK
