Trump calls for interest rate cuts: Bitcoin is rising rapidly, what happens now?

Trump calls for interest rate cuts: Bitcoin is rising rapidly, what happens now?

On July 10, 2025, Donald Trump called on the US Federal Reserve to cut the key interest rate by 300 basis points. This demand is leading to massive reactions in the financial markets and is particularly affecting cryptocurrencies. Trump said on Truth Social that current interest rates are increasing US refinancing costs by $360 billion annually. Bitcoin's price reacted immediately to Trump's post, rising 0.8% to $109,343 in 30 minutes, as reported it-boltwise.de reported.

Analysts at The Kobeissi Letter have examined the implications of this demand in more detail. They reported that U.S. interest payments were $1.2 trillion last year, or about $3.3 billion per day. While Trump talks about $360 billion in savings per percentage point on a $36 trillion national debt, more realistic estimates show that a 300 basis point rate cut could save about $174 billion in the first year.

Economic implications of the interest rate cut

However, calling for a rate cut carries significant risks. Historically, the Federal Reserve has never cut interest rates by more than 100 basis points. Experts warn that a 300 basis point cut would be unprecedented in a growing economy. Such a move could push inflation above 5% and devalue the U.S. dollar by more than 10%.

Another critical point is the possible increase in real estate prices. Falling mortgage rates would potentially lead to a boom in the real estate sector. In the short term, asset markets could boom, including gold, oil and the S&P 500, which could potentially rise above 7,000 points. However, these developments could have destabilizing consequences in the long term if there are no significant cuts in US government spending.

Market analysis and Bitcoin reactions

For the Bitcoin market, a rate cut could be viewed as a monetary stimulus. This could lead to an increase in capital into real assets and alternative stores of value such as Bitcoin. Technical analysis has shown Bitcoin price testing resistance near $109,761 and forming higher lows above $108,500. The Bollinger Bands are compressing, which historically usually indicates an impending breakout, like coindesk.com analyzed.

Traders' reactions to Trump's announcement show significant increases in buying volume, indicating increasing market participation. Institutional accumulation is also clearly visible as there are volume clusters at the support zones between $108,500 and $108,600.