Fed Coronavirus Rate Cut May Beat Bitcoin Inflation After 2020 Halving

The United States Federal Reserve will cut its interest rate target to compete with Bitcoin post-halving, traders believe.

As Reuters reported on Feb. 28, Wall Street traders already consider the likelihood of the Fed cutting rates to boost the economy over coronavirus to be more than 75%.Fed "Monitoring" coronavirus.

By September, the cuts could total 0.75%, bringing the short-term interest rate below 1% for the first time in three years.

The Fed did not appear rattled by coronavirus, which is now spreading more quickly outside its epicenter of China than within it.

Previously, U.S. president Donald Trump described the threat from coronavirus to the country still being "Very low."

A potential dramatic rate reduction would see the Fed keep up with the planned supply decrease in Bitcoin set for May. Known as the block reward halving, the event will shave 50% off the lot of "New" Bitcoins released to miners every 10 minutes.

Bitcoin's inflation rate will be under 2% - less than the Fed's current long-term target, and also undercutting that of gold.

Bitcoin's relationship to coronavirus meanwhile remains a topic of speculation.

Having previously risen as markets became unsettled, further deterioration has likewise driven down BTC/USD. Bitcoin vs. the S&P 500 showing the impact of coronavirus.

As Cointelegraph reported, one well-known pro-Bitcoin analyst is already betting that Bitcoin hits $40,000 before the Dow sees 40,000 points.