Fed urged to cut rates as recession concerns rise
by Tiffany Wang, WOO Analyst
Last week saw significant risk-off sentiment in the market. Bill Dudley, former president of the Federal Reserve Bank of New York, argues that the Fed needs to cut rates as soon as possible. Dudley's concern centers on the Sahm Rule, a historically reliable recession indicator. This rule compares the current three-month moving average of U.S. unemployment with the lowest three-month moving average over the past year.
If the current average exceeds the lowest by more than half a percentage point, it signals an impending recession. In the latest update for June 2024, the Sahm Rule figure stood at 0.43 percentage points, just below the 0.50 threshold. U.S. stocks also experienced a risk-off sentiment last week.
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Bitcoin rebounded after reaching a low of $66,650, following Donald Trump's official speech at the Bitcoin conference on July 27.
The rebound target remains at $71,000-$72,000. If BTC surpasses $71,000, it could trigger significant short position liquidations amounting to about $400 million.
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