What to Expect from Today’s FOMC Meeting

All eyes are on the US Federal Reserve today as it prepares to announce its latest interest rate decision. The Federal Open Market Committee (FOMC) will issue a policy update at 2 PM ET, followed by a press conference by Federal Reserve Chairman Jerome Powell at 2:30 PM ET.

The market expects the Fed to keep interest rates on hold, and right now there is a 97% chance there will be no change in interest rates. Some policymakers support lower interest rates to ease borrowing costs, while others prefer to keep rates steady, pointing to persistent inflation and a strong U.S. economy.

Is the Federal Reserve likely to keep interest rates stable?

Market expectations suggest that lower interest rates will be a positive development for risk assets, including cryptocurrencies. According to Polymarket, traders are currently pricing in a 70% chance of a 25 basis point rate cut. However, if interest rates remain the same, market sentiment could turn sharply negative.

According to Investing.com’s Fed Rate Monitor Tool, there is a 97.7% chance of a rate pause, while the chance of a rate cut is only 2.3%.

Recent economic data supports the claim that there is no immediate policy change. US CPI inflation remained flat at 2.7%, while PCE inflation, the Fed’s preferred indicator, rose slightly to 2.8%. At the same time, labor market data generally performed better than expected, demonstrating resilience despite the disruption caused by government shutdowns in 2025.

Former Federal Reserve Vice Chairman Roger Ferguson said policymakers would be patient.

“The economy continues to show fundamental strength, with orders for durable goods holding and unemployment remains relatively low,” Ferguson said, adding that inflation was still above the Fed’s 2% target.

This situation gives the Fed flexibility to delay cutting interest rates until there is clear evidence that inflation is continuing to fall.

Powell is expected to strike a familiar tone

Don’t expect any big surprises from Chairman Jerome Powell’s press conference. He will reiterate that policy decisions will rely on data without short-term interest rate cuts.

Chris Larkin, managing director at Morgan Stanley’s E*TRADE, believes politics can play a big role in headlines.

“Even though the Fed is not expected to cut interest rates, Chairman Powell’s press conference could be as much about the Fed’s independence as it is about policy,” Larkin said.

FED rate cut forecast in 2026 still uncertain

Even after today’s meeting, prospects for an interest rate cut in 2026 remain mixed.

Goldman Sachs predicts that the U.S. economic growth rate will accelerate to 2-2.5% in 2026 due to easing financial conditions and tax cuts. Chief economist Jan Hatzius predicted the Fed would likely pause interest rates in January and then cut rates in March and June, bringing rates down to 3% to 3.25%.

However, JP Morgan took a more cautious stance, predicting that the Federal Reserve would keep interest rates stable through 2026 and could raise rates in 2027 if inflation persists.

Oscar Munoz, chief U.S. macro strategist at TD Securities, believes easing measures are still on the table.

“While Powell may sound noncommittal in the near term, central Fed officials are still seeking easing this year,” Munoz wrote.

• Also read:
• Impact of this week’s Fed meeting on Bitcoin and cryptocurrencies
• ,

Bitcoin and Risk Assets Face FOMC Volatility

Today’s decision may seem uneventful, but history shows that FOMC meetings often trigger sharp moves in Bitcoin and other risk assets.

According to data shared by Ali Charts, Bitcoin has declined in seven of the eight FOMC meetings in 2025, with losses ranging from 6% to 29%. In the most recent session, BTC fell 9%.

This pattern highlights that even when markets price bullishly ahead of a Federal Reserve meeting, the reaction following the announcement is often skewed bearish.

Liquidity Signals Could Change the Narrative

Former BitMEX CEO Arthur Hayes pointed to increasing stress in the Japanese bond market as a potential wild card. He pointed out that the weakening yen, along with rising Japanese government bond yields, could trigger intervention by U.S. authorities.

“Such an intervention would effectively inject liquidity,” Hayes said, adding that it could ease pressure on U.S. Treasury yields and provide near-term support for risk assets, including Bitcoin.

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