The Federal Reserve is set to conclude its two-day FOMC meeting today, leaving Wall Street split on the outcome. Markets assign about a 36% chance of a surprise 25-basis-point rate hike from the current 3.50%-3.75% range. That means while most traders expect no change, a sizeable minority is betting on a hike. This indecision adds tension for investors, especially in crypto, where Bitcoin hovers near $63,000 ahead of the announcement.
Inflation continues to pressure the Fed. May’s Consumer Price Index came in at 4.2%, far above the 2% target, and although June figures hinted at a potential shift, prices remain stubbornly high. For the Fed, pausing too soon risks fueling inflation expectations, but moving too quickly could stifle economic growth. The current rate band is already tightening financial conditions, so many analysts expect Chair Kevin Warsh to opt for patience.
Bitcoin's history around these meetings is grim. It has fallen after the last nine FOMC decisions across 2025 and 2026, usually dipping between 3% and 7% in the two days following announcements. Rate hikes or hawkish signals strengthen the dollar and push bond yields up, draining liquidity from riskier assets like crypto. If the pattern holds, Bitcoin could slide to between $58,500 and $61,000, triggering stop losses and forced liquidations, which might deepen the downturn.
The impact extends to Bitcoin ETFs too. In 2026, the Fed’s hawkish moves sparked significant outflows from spot Bitcoin ETFs, with one hold causing a $708 million withdrawal in a single day. This adds another layer of pressure on the market as investors react quickly to interest rate signals.
This material is for informational purposes and not financial advice.
