Kevin O’Leary says he is not positioning his portfolio around expectations of a U.S. Federal Reserve rate cut in December. The entrepreneur and investor pushed back against growing speculation that the Fed will ease policy — a move that is often seen as positive for crypto markets.
Despite the uncertainty, O’Leary does not believe a rate hold will hurt Bitcoin’s price.
“I don’t actually think the Fed’s gonna cut in December,” O’Leary told Cointelegraph on Tuesday. He added that such a decision “isn’t going to make a difference to Bitcoin.”
Why O’Leary expects limited Bitcoin movement
O’Leary explained that he is not investing with a December rate cut in mind. He believes there are several reasons the Fed could decide against easing. One major factor is persistent inflation. U.S. inflation rose to 3% in September, the highest level since January.
He pointed out that the Fed must balance inflation and employment. Rising tariffs and higher input costs also add pressure. Even so, traders still assign an 89.2% probability to a December rate cut, according to the CME FedWatch Tool.
Crypto investors often view rate cuts as bullish for digital assets because falling yields make riskier markets more attractive. However, some analysts warn that an unexpected decision from the Fed could spark volatility in Bitcoin and other cryptocurrencies.
O’Leary remains calm. He believes Bitcoin has found a stable level for now. “I think it’s going to drift within 5% of where it is now,” he said. He does not expect a major move in either direction and sees no strong catalyst for a breakout.
Bitcoin has fallen 17.35% in the past 30 days and is currently trading around $91,440, according to CoinMarketCap.
Rate-cut expectations have shifted sharply
Market expectations for a December rate cut have been volatile. On Nov. 19, the probability dropped to 33%, down from about 67% in early November. But sentiment changed quickly. On Nov. 21, the odds nearly doubled to 69.4% after New York Fed President John Williams said the Fed could cut rates “in the near term” without jeopardizing its inflation target.
Following rate cuts in September and November, markets generally expected the Fed to continue easing through the end of the year.
