Bitcoin and Ethereum Traders Should Watch 'Narrative Whipsaw' Heading into Fed Decision
Bitcoin and Ethereum have risen 2.1% and 3.5% respectively ahead of the U.S. Federal Reserve’s interest rate decision. Bitcoin is trading around $89,842; Ethereum has climbed above $3,000. Markets overwhelmingly expect the Fed to keep rates unchanged, with CME futures showing a 97% probability of no move and low chances of a cut before July. Analysts suggest that while a rate hold is nearly certain, shifts in the Fed’s narrative—especially regarding the labor market—could influence crypto prices. If Chair Powell signals prioritization of labor market strength over inflation, rate cuts could be delayed, potentially pressuring crypto assets. Investors are focusing on assets like Bitcoin as a hedge against currency debasement. Meanwhile, macroeconomic uncertainty persists, including an upcoming U.S. government funding deadline and possible legislative shifts, which could further impact digital asset markets. Lower interest rates typically benefit Bitcoin and Ethereum by encouraging risk investment, whereas delays in rate cuts could shift capital toward yield-bearing assets.
