Fed signals easing as PCE inflation stays elevated; crypto traders brace for volatility ahead of Powell’s speech and future rate cuts.
All eyes are on the Federal Reserve Meeting Today as the central bank prepares to release its latest meeting minutes, and crypto markets are closely watching for signals on future policy moves. Fed Chair Jerome Powell will also speak today at 8:30 a.m. EST, giving further guidance on the pace of potential rate cuts expected later this month.
The recently released minutes show a dovish stance from most FOMC participants. Economic growth in the first half of 2025 slowed compared to the same period last year, driven by weaker domestic spending, softening wage growth, and a slight rise in unemployment to 4.3%. Inflation remains elevated, with total PCE at 2.7% and core PCE at 2.9%, influenced in part by tariffs and supply chain pressures.
Nearly all Fed officials expect the federal funds rate to decline soon, with a 25-basis-point cut already in place and more easing likely later in the year. Officials emphasized the need for a careful approach, striking a balance between the risks of inflation and employment concerns, while also considering the potential effects of technology and AI on economic growth.
Bitcoin is trading near $122,400, with the broader crypto market capitalization around $2.44 trillion. Traders are positioning ahead of Powell’s speech, as lower interest rates typically push capital toward risk assets like cryptocurrencies. Altcoins are following Bitcoin’s momentum, with some showing strong short-term gains, though analysts warn of potential volatility.
Powell’s remarks today will be closely watched for any indication of how aggressive the Fed will be with future rate cuts. If the Fed signals continued easing, crypto markets could benefit from increased liquidity and positive sentiment. A cautious tone, on the other hand, could lead to short-term swings as investors adjust expectations.
Overall, the combination of dovish FOMC minutes and Powell’s upcoming speech is likely to shape crypto market trends in the coming weeks, particularly for Bitcoin and major altcoins.
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