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The Federal Open Market Committee (FOMC) is concluding its final policy meeting of 2025 today, December 10, with the interest rate decision scheduled for 2:00 PM ET and Chair Jerome Powell's press conference following at 2:30 PM ET.60146a This two-day gathering, which began on December 9, marks the eighth and last regularly scheduled FOMC session of the year. Markets are bracing for significant swings, as the Fed's actions and forward guidance often trigger rapid repricing across asset classes, including stocks, bonds, currencies, and cryptocurrencies.

#Key Expectations for Today's Decision
Rate Cut Probability: Traders are pricing in an approximately 87-89% chance of a 25 basis point (bps) rate cut, which would lower the federal funds rate to a range of 3.50-3.75%—the lowest level in nearly three years. This would be the third consecutive cut, following reductions in September and November, amid cooling inflation and a softening labor market.
Economic Projections (Dot Plot): The Fed will release its updated Summary of Economic Projections (SEP), including the "dot plot" of individual members' rate forecasts for 2026 and beyond. Analysts anticipate a slight downward revision in the 2026 median rate projection, but any hawkish shift—indicating fewer cuts ahead—could dampen risk appetite.
Recent Context: Quantitative Tightening (QT) officially ended on December 1, halting the Fed's balance sheet runoff after removing over $2 trillion in liquidity since 2022. This shift to a more neutral stance could support asset prices, but sticky inflation data and internal Fed divisions— with some officials pushing for caution—add uncertainty.
#Why Volatility Is Likely
FOMC days are notorious for market turbulence, as initial reactions to the rate decision often reverse during Powell's Q&A session, where his tone on inflation, employment, and future policy can override the headline cut.
Recent history shows amplified effects in crypto: Bitcoin ($BTC ) has declined after the last four FOMC meetings, including a 30% drop following a hawkish pivot in one instance. Broader markets could see similar whipsaws, with yields rising on hawkish signals or equities rallying on dovish hints.
#Potential Scenarios and Market Impacts:
Dovish Outcome (Bullish for Risk Assets): A 25 bps cut paired with Powell emphasizing "further progress on disinflation" and flexible policy if data weakens. Dot plot shows more cuts in 2026. Expect: Stocks and crypto rally (e.g., S&P 500 and BTC up 1-2% initially), yields fall, USD weakens.
Neutral/Choppy (Sideways Action): Cut as expected, but Powell stresses "data dependence" without clear guidance. Dot plot holds steady. Expect: Knee-jerk gains fade into range-bound trading, with intraday volatility trapping both bulls and bears.
Hawkish Surprise (Bearish Pressure): Cut delivered, but with emphasis on persistent inflation risks or a higher-for-longer stance. Dot plot unchanged or revised upward. Expect: Yields spike, equities and crypto pull back (possible 1-3% drops), USD strengthens.
@Broader Implications
For Investors: This meeting caps an "eventful" 2025 for the Fed, with Powell having just three more sessions before his term ends in early 2026. Speculation around his successor—potentially influenced by the incoming Trump administration—adds a layer of long-term uncertainty. Liquidity conditions are improving post-QT, which could cushion downside, but any signal of a 2026 pause might cap year-end rallies.
Real-Time Sentiment: Social discussions highlight caution, with traders noting patterns of post-FOMC dumps and advising nimble positioning. Some are betting on aggressive moves, while others warn of traps in volatile conditions.
Stay tuned for live updates as events unfold—volatility could extend into after-hours trading if Powell's comments deviate from expectations.
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