The Federal Reserve wraps up its two-day FOMC meeting today, and Wall Street’s consensus can be summarized in one word: shrug. Markets are pricing in about a 35.8% probability of a surprise 25-basis-point hike from the current 3.50%-3.75% federal funds rate, which means the majority of traders expect a hold. But “majority” is doing a lot of heavy lifting when more than a third of the market thinks otherwise.
For crypto investors, the stakes are quietly enormous. Bitcoin is trading around $63,000 heading into the announcement, and history suggests the next 48 hours could get uncomfortable regardless of what Chair Kevin Warsh decides to do.
The split on Wall Street
The case for a hike rests on inflation that refuses to cooperate. May CPI came in at 4.2%, and while June data released on July 14 served as what Bitfinex analysts called a “significant pivot point,” the broader trajectory hasn’t given the Fed much room to relax. Prices are still running well above the 2% target, and a central bank that pauses too long risks looking complacent.
The case for holding steady is simpler. The Fed has already pushed rates to 3.50%-3.75%, a level that’s doing meaningful work tightening financial conditions. Most analysts on the Street are betting that Warsh will choose patience over aggression.
