Trump Plans 1% or More Lower Rates By 2026, Markets Confused

Trump Pushes for 1% Interest Price: What Lower Rates Means for Crypto

Should the US return to ultra-low interest prices to revive growth and markets?

President Donald Trump believes so. In a recent interview, Trump stated that US interest levels should be cut to 1% or even lower rates by 2026, reigniting debate around the Federal Reserve’s future policy direction, its independence, and the impact on risk assets like crypto.

Source: AshCrypto

Impact on market from Trump’s view, why?

Although the Federal Reserve operates independently, presidential influence over future leadership matters. A Fed chair aligned with Trump’s preference for lower rates could also shift long-term policy expectations.

Trump Pushes for Aggressive Rate Cuts

Trump’s comments come at a time when the Federal Reserve has already begun easing monetary policy. The central bank recently delivered a 25 basis points cut, the third Fed rate cut of the year, lowering the benchmark rate to 3.5%–3.75%, but signaled that further cuts may slow.

Currently:

• The Fed projects only one more cuts in 2026

• Markets still price in two cuts next year

• Futures traders see a high probability of no price change in January

Trump, however, made it clear that he favors a much more aggressive approach. He argued that significantly lower rates would support economic growth, reduce government borrowing costs, and Boost financial markets, including equities and crypto

His remarks were confirmed by major media reports and come alongside growing discussion about appointing a new Fed chair, with former official Kevin Warsh frequently mentioned, who is also a supporter of reduced levy policy.

Market and Crypto Reaction So Far

Historically, lower rates are considered bullish for crypto because they increase liquidity and reduce returns on safe assets. However, recent reactions show that markets are now more sensitive to federal reserve guidance, not just the cut itself. 

On December 10, the crypto market reacted sharply to the Fed rate cut announcement. Within 24 hours, the total crypto market fell around 3%, extending earlier month losses. Bitcoin dropped nearly 2.5%, while Ethereum and major altcoins underperformed.

Talking about current conditions, it aligns with the previous one as the broader market is down 1.74% today, with bitcoin at $90,423 (-2%) and Ethereum at $3,112 (-3.92%).

Source: CoinMarketCap

Looking ahead, if Trump’s vision of 1% interest level in 2026 gains traction, crypto could benefit in the long term. Sustained lower rates typically support risk assets like Bitcoin. Still, short-term volatility is likely if the Fed pauses cuts or inflation concerns return.

Why Rate Cuts Are Being Discussed Frequently

Rate cuts are mainly being considered to support economic growth, housing affordability, and borrowing conditions. Lower rates reduce mortgage costs, help businesses access cheaper capital, and ease pressure on consumers.

At the same time, inflation remains a concern. the4 Central bank officials want to avoid cutting too quickly and risking another inflation surge. This is why policymakers stress that future decisions will remain data-dependent, balancing growth support with price stability.