State Street Predicts 10% Drop in Dollar with Aggressive Fed Rate Cuts

State Street cautions that aggressive rate cuts by the Fed could lead to a significant decline in the dollar, boosting interest in Bitcoin and risk assets.

State Street has issued a warning that the US dollar might plummet by up to 10% if the Federal Reserve implements rate cuts more aggressively than anticipated. Such a shift in monetary policy could potentially redirect investment flows towards Bitcoin and other high-risk assets.

The financial institution's analysis suggests that a rapid decrease in interest rates could trigger a significant depreciation of the greenback, pushing it to lows not seen in years. In this environment, investors may seek the perceived safety and growth potential of cryptocurrencies, particularly Bitcoin.