UPDATE: Fed Expected to PAUSE in January 🇺🇸📉 (High-Probability Signal) ⚠️⚠️⚠️⚠️
New market data is in — and traders are now assigning a strong likelihood (around 84%+ via CME FedWatch) that the U.S. Federal Reserve will leave interest rates unchanged at the Jan 27–28, 2026 FOMC meeting 🦅🦅
After three straight 25 bps cuts in late 2025, bringing rates to 3.50%–3.75%, the Fed looks set to start the year with a pause.
Why markets expect no move:
Economic data remains resilient: Jobs numbers came in stronger than expected, sharply reducing near-term cut bets.
Inflation is still sticky: Potential tariff pressures and upside risks are keeping policymakers cautious.
Near “neutral” rates: The Fed appears comfortable waiting before easing further.
Earlier hopes for another cut have faded quickly — markets now price only ~16% odds of a surprise 25 bps reduction.
What this means:
Borrowing costs (mortgages, loans, credit cards) likely stay elevated → more short-term stability than volatility.
Savers and fixed-income investors benefit as higher yields stick around.
Risk markets may cool on “easy money” narratives, while attention shifts to possible cuts later in 2026 (consensus: 1–2, potentially starting spring/summer).
This pause aligns with a “wait-and-see” phase after 2025’s easing cycle. With a new Fed Chair possibly coming mid-year (Powell’s term ends May 2026), the policy outlook could shift quickly.
Is this just a brief pause before more cuts — or the start of a longer hold? Markets are watching every data point closely. January’s decision is coming fast 🔥💰
Market Watch:
$BNB $HOME $POL What’s your strategy — positioning for stability now, or betting on future easing? 📊
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