Will the Fed’s Interest Rate Decision Affect Crypto This Week?

Crypto markets remained stable over the weekend. Volatility may increase, but a quarter-point rate cut at the main event of this week, the Federal Open Market Committee (FOMC) meeting on monetary policy on Tuesday and Wednesday, is largely priced in.

A week filled with economic data lies ahead, and there are several things to pay attention to.

Economic Events from December 8 to 12

On Tuesday, reports on job openings for September and October will be released, while on Thursday, initial claims for unemployment benefits will be published. This provides a clear picture of the U.S. labor market, which is one of the Fed’s mandates for monetary policy decisions.

The U.S. central bank will announce its monetary policy decision on Wednesday, and a quarter-point rate cut to 3.5 to 3.75 percent is expected. According to the CME Fed Watch Tool, there is currently an 88.4 percent probability of this.

The Fed will also release its quarterly Summary of Economic Projections, which could provide insight into the number of rate cuts expected next year.

Markets are forecasting an interest rate of about 3 percent by December 2026, which is a much more aggressive easing cycle than the central bank currently predicts, Barrons reported.

As inflation cools and growth remains relatively stable, sentiment remains positive ahead of year-end. However, there is still some uncertainty surrounding trade tariffs, consumer demand, and Fed policy, which could keep investors cautious.

Futures prices for U.S. stocks were stable on Sunday evening after another successful week for Wall Street, while cryptocurrency markets remained stable.

Outlook for the Crypto Market

The total market capitalization rose to $3.18 trillion late Sunday.

Bitcoin initially fell, dropping below $88,000 during Sunday before bouncing back twice to $91,500 in the following hours. It is currently trading around $91,900 but faces strong resistance above that level.

Ethereum mirrored that trend, briefly falling below $3,000 only to recover and return to the $3,100 level.