Top Trader Bets Big on 50bps Fed Rate Cut: Will the Market Follow? 🤷‍♂️

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Markets

What to know:

  • A top trader on Polymarket, with a flair for the dramatic, is betting on a 50 basis point interest rate cut by the Federal Reserve next week. 🎲
  • This daring individual, known as JustWakingUp, has placed a whopping $15,000 bet and could earn a cool $226,000 if the Fed decides to go big. 💰
  • However, the market, being the pessimistic beast it is, expects only a 25 basis point cut, with a 91% probability according to the CME’s FedWatch Tool. 📊

A leading trader on the decentralized betting platform Polymarket, who goes by the name JustWakingUp, is making headlines with a bold wager that the Federal Reserve (Fed) will slash interest rates by 50 basis points (bps) next week. It’s like betting on a unicorn to win the Kentucky Derby. 🦄

According to the illustrious X handle Polymarket Whales, JustWakingUp is the platform’s most prolific trader, boasting nearly $400 million in total trading volume to date and profits exceeding $2 million. That’s more money than you’d find in a pirate’s treasure chest. 🏴‍☠️

The trader has placed a $15,000 bet that the Fed will reduce rates by 50 bps to 3.75% next week and is already showing a 3% gain on the position as of writing. If the Fed does cut rates by 50 bps, JustWakingUp stands to make roughly $226,000. It’s like winning the lottery without buying a ticket. 🎟️

The market, however, largely expects the Fed to deliver a 25 basis point cut next week, with the CME’s FedWatch Tool assigning a 91% probability to such an outcome. But hey, who needs logic when you can have hope? 🌈

That said, the odds of a jumbo 50 bps cut have surged to nearly 10% following Friday’s disappointing August jobs report, reflecting growing expectations of more aggressive easing. Even BlackRock and StanChart are calling for a 50 bps cut. It’s like everyone’s suddenly become an optimist. 😊

Adding to market expectations, the U.S. Bureau of Labor Statistics reported on Tuesday that the economy added 911,000 fewer jobs in the 12 months ending March 2025 than previously estimated, marking the largest annual downward revision on record. It’s like finding out your favorite restaurant has been serving you fake steak all this time. 🥩

Traders are now closely watching Wednesday’s U.S. Producer Price Index and Thursday’s Consumer Price Index data releases. Softer-than-expected readings could add to expectations for a 50 bps cut, potentially sending bitcoin and stocks higher. It’s a rollercoaster ride, folks, so buckle up! 🎢

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2025-09-10 10:14