FOMC Decision: Will the Fed Surprise the Crypto Market?

Jakarta, Pintu News – Ahead of the Federal Open Market Committee (FOMC) meeting to be held tomorrow, global market participants’ attention is on the Fed’s interest rate decision and future monetary policy projections. With geopolitical uncertainty due to the ongoing US-Iran conflict, expectations for an interest rate cut this year are dwindling.

Investors are now waiting for the latest signals from the dot plot as well as Fed Chairman Jerome Powell’s press conference to get an idea of the next direction of monetary policy. This situation has also had a significant impact on the crypto market, with price volatility of Bitcoin (BTC) and other digital assets increasing ahead of the Fed’s official announcement.

Market Focus: Dot Plot and Powell’s Press Conference

In this FOMC meeting, the main attention of the market is on the dot plot update that will be released by the Fed officials. This dot plot is a graph that displays the benchmark interest rate expectations of each FOMC member for the next few periods.

Based on the last dot plot in December, the median projection is that there will only be one rate cut this year. However, with rising inflationary pressures due to the conflict in the Middle East, there is a possibility of the projection being revised to no cut at all.

In addition to the dot plot, Jerome Powell’s press conference is also a crucial moment that market participants are looking forward to. Powell is expected to provide the latest views regarding the condition of the United States economy, specifically regarding inflation and employment growth. Many analysts expect Powell to be cautious and avoid statements that are too dovish or hawkish.

Also read: 3 Crypto Whale Buys and Loses Ahead of FOMC

Market Expectations and Their Impact on Crypto Assets

The latest data from Polymarket shows that the chance that the Fed will only cut interest rates once this year stands at 30%. Meanwhile, the probability of no cut at all rose to 23% in the past week, as geopolitical tensions escalated.

Before the US-Iran conflict heated up, crypto market participants had even estimated the possibility of three rate cuts this year. However, now that chance has plummeted to just 12%.

This situation has a direct impact on the price movements of crypto assets such as Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP). Ahead of the FOMC announcement, the price of Bitcoin (BTC) had surged to $75,000, signaling market participants’ optimism towards the potential for a looser monetary policy.

However, high volatility remains looming, given that the Fed’s decision largely determines the future direction of the market. Traders now tend to be more cautious in taking positions, waiting for clarity from the FOMC meeting results.

Read also: Bitcoin (BTC) Price Ahead of Eid: Ready to Break $80,000? Here’s the Analysis!

Inflation and the Fed’s Dual Mandate Challenge

The Fed’s dual mandate of maintaining price stability and promoting job growth is now facing a tough challenge. Core Personal Consumption Expenditures (PCE) inflation recorded a rise to 3.1% in February, well above the Fed’s target of 2%.

This condition makes the Fed’s room to cut interest rates very limited, especially amid the threat of rising prices due to geopolitical conflicts.

On the other hand, the US labor market is also starting to show signs of slowing down. This adds to the complexity for the Fed in determining the right policy.

Jerome Powell is expected to highlight these two aspects in his press conference, while signaling that the interest rate decision will be highly dependent on subsequent economic data. Thus, market participants are expected to remain alert to potential changes in the direction of monetary policy in the next few months.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities are subject to high risk and volatility, always do your own research and use cold hard cash before investing. All activities of buying and selling Bitcoin and other crypto asset investments are the responsibility of the reader.

Reference

• Coingape. FOMC Meeting: What To Expect From The Fed Rate Decision Tomorrow. Accessed on March 18, 2026
• Featured Image: Generated by Ai