After the FOMC meeting, it is expected that interest rates will remain at 5% to 5.25%. The FOMC Dot Plot indicated that most Fed officials are on the dovish side when it comes to interest rate decisions. It also showed that there was a "skip" vote in June for additional hikes later this year.
Wall Street giants accurately predicted the historic drops in inflation data for May and June. As a result, these giants continue to see gains in cryptocurrencies and stocks. Analysts from JP Morgan, Goldman Sac. Morgan Stanley, Bloomberg, Barclays, BMO, CIBC, Nomura, RBC, and Wells Fargo believed that therewould be no rate hike in June. In fact, the CME FedWatch Tool shows a 95% probability of the Fed keeping the policy rate unchanged.
With declining Treasury bond yields and cooling annual CPI and core CPI inflation in May, the bond market expected the Fed to "skip" the June interest rate hike. Additionally, the U.S. dollar, as measured by the U.S. dollar index (DXY), continues to decline around 103. Global markets are also recovering from economic slowdown, and recession risks are diminishing.
For the first time since starting this tightening cycle in March 2022, the Fed will likely keep interest rates steady at the June FOMC meeting. Chairman Jerome Powell and his colleagues will probably describe the decision as a "hawkish skip."
Fed Chairman Jerome Powell stated that Fed officials preferred to wait and assess the impact of past rate hikes on the economy, taking into account bank failures, the debt ceiling, and the Treasury Department's bond issuances.
Dow Jones, S&P 500, and Nasdaq futures contracts are rising as major fund managers and investors abandon their bearish bets and buy stocks in anticipation of inflation cooling and the expectation ofthe Fed skipping a rate hike.
Post-FOMC Recovery in the Crypto Market: Bitcoin and Ethereum Prices to Rise Wall Street analysts expect positive macro factors to drive the prices of Bitcoin and Ethereum higher. Experienced trader Peter Brandt predicts that the BTC price action shows a "hinge" behavior while the price moves in balance on the daily chart.
Additionally, a "three-star bottom" formation on the daily timeframe signals a bullish move. However, the monthly chart has shown a downward trend that has caused sideways movement in Bitcoin for the past few days. The Fed's "skip" has broken this stagnant price movement, and the price is recovering.
BTC is currently trading above $25,960, continuing its sideways movement in the past 24 hours. The 24-hour low and high are $25,728 and $26,376, respectively . Meanwhile, the ETH price is currently trading above $1,750. The 24-hour low and high are $1,727 and $1,761, respectively.
This article is not investment advice. Anyone considering investing should do their own research and take their own risks.
