Fed likely to hold rates as September hike odds fall
TD Securities’ strategist, via Bloomberg Economics, says the Fed likely to hold rates, supported by recent data. Market pricing has shifted: the probability of a September 15–16 rate hike fell from 47% to 31% over the past week. Odds for an October 27–28 hike dropped from 58% to 45.5%.
The FOMC and Chair Jerome H. Powell remain central as the Fed weighs inflation trends, unemployment, and consumer spending. As new economic releases arrive, expectations may move again.
What to watch next: upcoming FOMC statements/minutes and key inflation and employment data. Powell’s speeches or press conferences could further indicate whether the Fed will extend the pause.
For traders, the headline is that the Fed likely to hold rates in the near term, which can influence USD liquidity, risk appetite, and crypto volatility as rate expectations cool.
Neutral
The article’s main point is that the Fed likely to hold rates in the near term, as market pricing for both the September and October meetings has declined. This typically reduces the immediate “tightening shock” risk to risk assets, including crypto, because fewer hikes implies a less restrictive USD/real-rate backdrop.
However, the outlook is not fully locked in. The Fed’s path still depends on incoming inflation and employment data, and Powell’s future remarks can quickly re-price expectations. Historically, when markets move from “hike” odds toward “pause,” crypto often sees short-term relief rallies; but if later data reignites inflation fears, the same trade can reverse fast.
So the expected effect is likely mixed: slightly supportive for risk sentiment near term, but not a clear trend signal for long-term direction until the next set of macro prints and FOMC communications confirm the pause.