Today, June 18, at 2 PM Eastern Time, the US Federal Reserve will hold a meeting where it will announce its decision on interest rates. The crypto market is waiting to see what changes may occur.
Expectations from Today's Meeting
Most experts believe that there will not be a rate cut today. According to CME Group data, 99% of market participants expect the Fed to hold interest rates at current levels. This apprehensive behavior can largely be attributed to increased global tensions, particularly the conflict between Israel and Iran, which has already impacted the global economy. In the current scenario, there is little likelihood of the Fed making a reverse move, given that inflation is still not under control.
Powell's Speech and Its Consequences
While the Fed's decision on a rate cut is mostly expected to be a non-event, all eyes will be on Jerome Powell's speech. He is expected to discuss how interest rates will be decided in the future and how the Fed considers major aspects like economic growth, inflation, and job data. If Powell keeps a dovish tone, hinting that rate cuts will be forthcoming, it could ignite a rally. Conversely, if he adopts a hawkish stance by claiming that rates will remain higher for longer, it may lead to investor panic.
Possible Reactions from the Crypto Market
For the crypto industry, this Fed FOMC meeting may be a turning point. It is anticipated that, if rates are reduced (unlikely today), crypto prices might skyrocket. Bitcoin and altcoins typically do well when interest rates are lowered as more investors shift toward riskier assets. If rates remain constant, the crypto market could face declines due to high interest rates and escalating global tensions leading to increased selling pressure.
Today's Fed meeting is unlikely to result in a rate cut, but it may lead to significant market movements. Powell's comments will shape expectations for the next meeting scheduled for July 30.
