As the Federal Open Market Committee (FOMC) prepares to meet tomorrow, the crypto market stands at a key inflexion point. Investors are watching closely for clues from Fed Chair Jerome Powell that could sway digital asset prices, especially Bitcoin, which is trading near $95,000.
Most analysts expect the Fed to hold interest rates steady in the 4.25% to 4.5% range, signalling caution in light of persistent inflation concerns and efforts to preserve economic stability.
Meanwhile, Ethereum is holding ground near $1,787, and the broader crypto landscape remains highly sensitive to any shifts in U.S. monetary policy.
Powell’s Tone Could Determine Bitcoin’s Next Move
Market participants will listen closely to Powell’s post-meeting remarks, hoping to gauge the Fed’s future path. A dovish tone—hinting at rate cuts or easing of quantitative tightening—could spark renewed bullish sentiment in crypto.
Such a stance might send Bitcoin rallying toward the $100,000 mark and breathe life into struggling altcoins.
However, a hawkish signal, with Powell emphasising persistent inflation and the need for tight monetary policy, could weigh on crypto prices. In that case, Bitcoin may retest support near $89,000, dragging the rest of the market down.
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Trade Tensions and Inflation Add Complexity
Although the U.S. economy has shown strong job growth and rising consumer prices, the Fed is expected to resist calls for rate cuts, particularly those from President Trump, who recently claimed inflation is no longer a threat and urged the central bank to ease policy.
Despite political pressure, the Fed maintains its independence. New tariff measures and ongoing trade tensions may complicate its strategy, especially if they contribute to higher consumer prices.
Economists warn that these developments could hit lower-income households the hardest, as borrowing costs and daily expenses remain elevated.
Market Outlook: July Cuts Still in Sight?
Despite holding rates steady for now, the market still expects the Fed to begin cutting rates in July, with forecasts suggesting two to three cuts before year-end.
Consumers could benefit from lower loan and credit interest rates if that scenario plays out. At the same time, risk assets like crypto may see renewed inflows due to cheaper borrowing conditions and improved market sentiment.
Bottom Line: Macro Signals Are Crucial
With crypto assets tightly linked to macro trends, tomorrow’s Fed meeting—and Powell’s tone—could dictate the next major move for Bitcoin and Ethereum. Traders and investors alike are preparing for volatility, knowing that a single phrase from Powell could send ripples across the digital asset space.
