As the FOMC meeting on January 27–28, 2026 approaches, the narrative of 'higher for longer' returns to the forefront of the financial landscape. Current market pricing shows a probability ranging from 95% to 99% that the Federal Reserve will keep the interest rate unchanged in the range of 3.50%–3.75%.
📊 Macro Analysis
After three consecutive rate cuts in late 2025, policymakers are shifting to a 'wait-and-see' approach to ensure inflation does not rise again before taking further steps.
Key points:
Current interest rate: 3.50% – 3.75%
Staying rationale: Consumer spending is strong, and the labor market remains resilient despite cooling
Current inflation: Indicators such as Core PCE show a rate of about 2.8% — higher than the Fed's target of 2%
💡 The impact on cryptocurrencies and risk assets
Keeping rates steady often puts pressure on high-risk assets as it keeps borrowing costs high. However, markets have already priced in this scenario, so real volatility may come from the Fed Chair's tone during the press conference.
Possible scenarios:
Downside risks: If the Fed Chair indicates only one potential cut throughout 2026, liquidity expectations will shrink, which could slow the momentum of Altcoins' rise.
Bullish hopes: If the Fed acknowledges the 'fragility' of the labor market, traders may start betting on a cut in March or May, which could drive $BTC and $ETH to additional highs.
🎯 Important dates to watch
January 28: Interest rate decision + press conference
February 13: Release of the Consumer Price Index (CPI) report — a critical indicator for March cut expectations
The Federal Reserve maintains its cautious stance. At this stage, patience and risk management are the most important tools available.
Alert: This is a general economic analysis and not financial advice. Interest rate policies can change rapidly based on new data, so make sure to do your own research (DYOR) and manage your investment risks.
📊 Cryptocurrencies on a strong rise:
💎 $ENSO
💎 $NOM
💎 $RIVER
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