Definition ∞ Interest rate uncertainty describes the unpredictability surrounding future changes in central bank interest rates. This economic condition influences investor behavior across traditional and digital asset markets. Fluctuations in interest rate expectations can lead to significant market volatility.
Context ∞ Global macroeconomic conditions, particularly central bank policies, frequently introduce interest rate uncertainty, affecting capital allocation in digital asset markets. Higher interest rates in traditional finance can draw capital away from riskier assets like cryptocurrencies. Market participants closely monitor central bank announcements for signals regarding future rate adjustments.
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