Key dealers
- Bitcoin remains stable as investors are waiting for results from the Federal Open Market Committee meeting.
- The markets have lowered expectations for interest rate reductions this year and expected only one or two reductions.
Bitcoin remains range between $ 104,000 and $ 105,000 when investors have stags for the FOMC meeting planned in the next few hours.
With another interest rate expected commonly, the key focus will be on the Fed chairman Jerome Powell’s tone and any tips on future policy directions, especially since the outlook for interest rate cuts has moderated. Fed Fund Futures and bond markets now praise Only one or two decreases This year, a retreat from previous forecasts that require three or four.
What can you expect from the Fed meeting?
All eyes are on the FED’s updated “Dot Plot”, which will reveal where officials expect interest rates will go through the rest of 2025.
In March, the Pot plot showed agreement for two interest rate cuts in 2025. However, the economic background has since become more complex.
Fed officials now weigh not only inflation data but also intensify global uncertainties, including US trade policy changes and the escalating Israel -Iran conflict. These factors can greatly affect both inflation and growth courses.
While coolers CPI prints can give the Fed space to be patience, the effects of rising tariffs and geopolitical risk keep the outlook cloudy.
Many economists expect the Fed to adhere to their projection of two interest rates in 2025, but emphasize that more time and data are needed before any policy shifts.
What can you expect from Powell?
Fed chairman Powell is likely to deliver a Hawkian message, says QCP Capital on a Wednesday noteadds that the central bank would flag fresh inflation risks from increasing geopolitical disorders.
“The market currently prices in two interest rates in 2025 and two to 2026. But our base case is that the Fed can adopt a more cautious tone in its Sep, which potentially indicates an individual interest rate reduction for 2025, as opposed to market prices,” said QCP Capital.
Analysts said that if Fed signals less easier than expected, it can reduce expectations for future liquidity and put downward pressure on risk resources such as Bitcoin.
Bitcoin trade at approximately $ 104,800 at the time of reporting, Trade data shows.
Even with current challenges, some analysts believe that structural macro trends and growing institutional participation will lead to renewed strength in digital assets in 2025.
Analysts note that if the Fed lowers prices later this year, potentially during the third quarter, it can trigger an overall recovery, especially in the cryptoetfs and institutional flows.