Amidst concerns over inflation, the US Federal Reserve may consider cutting interest rates this year, according to recent reports. Inflation in the US has shown signs of easing, with the personal consumption expenditures price index (PCE) touching 2.6% for the year until May, down from the Fed's target rate of 2%.

Strategists at Morgan Stanley are betting that both the US and European Union central banks will cut rates in September, citing the likelihood of favorable labor market and inflation data. The European Central Bank is expected to continue its rate cut spree, with Governing Council member Olli Rehn anticipating at least two more cuts this year.

While the US inflationary pressure had previously kept the Fed from following suit, the recent core PCE value has raised hopes that the central bank could start cutting interest rates. Analysts had previously thought the Fed might wait until December or skip a cut in 2024 altogether, but Atlanta Federal Reserve President Raphael Bostic has now pinned a rate cut possibility for the fourth quarter of 2024.

However, the potential economic impact of a second term for former President Donald Trump has raised concerns among some economists. In a recent letter, sixteen economists expressed worries about the negative impact a Trump re-election could have on the US's economic standing and domestic economy, citing concerns over his "fiscally irresponsible budgets" and the potential for reigniting inflation.

Despite the rate cut hopes, the Bitcoin market has remained range-bound between $60,000 and $62,000, failing to see a significant surge in investor funds. Lower interest rates generally benefit industries and tech firms, as money becomes less expensive, and treasury bills and bonds become less attractive. However, the current market dynamics suggest that the news has not yet translated into a substantial increase in investor risk appetite for alternative assets like Bitcoin.