FOMC Meeting: The U.S. Federal Reserve System officials will meet today for the Federal Open Market Committee (FOMC) meeting for monetary policy discussion, with the interest rate decision scheduled on January 31. The global stock and crypto markets will keep an eye on Fed Chair Jerome Powell’s press conference for cues.
The Fed kept the interest rate steady at 5.25%-5.5% for a third consecutive meeting in December 2023, but anticipates three rate cuts of 75-100 bps in 2024. However, Wall Street giants JPMorgan, BlackRock, Morgan Stanley, Bank of America, and others estimated no Fed rate cuts in January and March.
As CoinGape reported earlier, BlackRock macro expert anticipates Fed rate cuts in June as recent PCE inflation, jobs, and retail sales data show the resiliency of the US economy, clearly indicating the Fed could delay rate cuts. Other analysts also have similar projections for rate cuts, with some expects rate cuts in 2024 third quarter.
Morgan Stanley’s Andrew Slimmon said Jerome Powell will be “patient” regarding rate cuts. “The economy appears strong and the Fed has time to be patient and make sure the true secular trend in inflation is lower.”
Moreover, the CME FedWatch Tool indicates almost 98% probability of the Fed keeping interest rates steady at 525-550 bps in the upcoming FOMC meeting on January 31. The dot plot showed the median year-end 2024 projection for the fed funds rate fell to 4.6% from 5.1% in September.
Traders will be paying close attention to Fed Chair Jerome Powell’s speech on monetary policy and rate cut plans for the year. It will be streamed live on Fed’s official YouTube channel. Also, traders will focus on the US Treasury quarterly refunding announcement on Wednesday, Jan 31.
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How FOMC Meeting Will Impact Crypto Market?
The U.S. Federal Reserve monetary policy decisions in FOMC meeting have a significant impact on the crypto prices, especially Bitcoin. The Federal Reserve’s preferred inflation metric US PCE cooled to 2.9%, lower than the market expectations of 3%. Thus, crypto prices are more likely to record upside momentum as the Fed remains dovish.
However, with the monthly close, the FOMC meeting, and earnings this week, Bitcoin price momentum will be range-bound. BTC price currently trades at $43,304, up almost 3% ahead of the FOMC meeting and other economic events.
Markus Thielen, CEO of 10x Research, in a new report, recommended investors to buy Bitcoin above $43,000 level. He predicted an upcoming Bitcoin (BTC) price rally as wave 5 begins, anticipating BTC price reclaiming 50,000 level by the end of this quarter.
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