Bitcoin Rally Trigger to $100,000? Goldman Sachs Envisions Fed Halting Interest Rate Hikes in September

• Goldman Sachs predicts that the Federal Open Market Committee (FOMC) could stop its final interest rate hike. 
• This could trigger more demand for risk-on assets such as stocks and cryptos to push prices upward. 

The US rising inflation and interest rate policy has been one of the most dominant determining factors on the Bitcoin (BTC) price in the past couple of years. According to data published by the Labour Department on August 10, the annual inflation rate for the 12 months ended July is 3.2 percent.

The next update on inflation in the US has been fixed on September 13. To control this rate, the Federal Reserve has in its 12 meetings increased the interest rate for the 11th time. Officials have disclosed that there would be one more interest rate hike this year. However, Goldman Sachs analysts believe that the Federal Open Market Committee (FOMC) would stop interest rate hikes in September. 

Analysts including Jan Hatzius and David Mericle stated:

The cuts in our forecast are driven by this desire to normalize the funds’ rate from a restrictive level once inflation is closer to target. 

Per their analysis, things could start getting better from June 2024 as the Federal Reserve stops interest rate hikes and starts quarterly reductions. The analysts believe that the FOMC would likely conclude in their next meeting that the final hike is not necessary since the inflation trend has slowed down. 

Normalization is not a particularly urgent motivation for cutting, and for that reason, we also see a significant risk that the FOMC will instead hold steady. We are penciling in 25 basis points of cuts per quarter but are uncertain about the pace.

Would Bitcoin be Impacted by the Interest Rate Decline?

This would be a piece of huge news for the equity, Bitcoin, and crypto market at large. Based on data, the equity, and the crypto market are bouncing back with some incredible growth. Nasdaq Composite has recorded a 31 percent surge. Bitcoin, on the other hand, has also made a 77 percent gain from the year to date. Interest rate hikes usually result in a sell-off of risk-on assets such as crypto. The opposite is also true. In this case, the Bitcoin price could take a huge jump to hit $100k when Goldman Sachs’ prediction materializes.

As of press time, Bitcoin had a bullish market sentiment and was trading at $29,404.87. The asset has surged by 1 percent in the last seven days and 8 percent in the last 90 days. Once it breaks into its $29,775.80 resistance level, there is a huge chance of hitting $30k. 

Another report has disclosed that both whales and retail addresses are accumulating digital assets. Crypto Analyst Ali Martinez has observed that there is a bullish divergence between the price and the network growth, and this signifies a sustained uptrend for Bitcoin. 

All major $BTC oscillators (MVRV, aSOPR, Puell Multiple, and Reserve Risk) continue to hover above the 0 line. This indicates the ongoing price correction might just be a blip.

According to him, it is important to buy the dip as the asset gathers momentum to target its all-time high price. 

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