Fed minutes lean hawkish: inflation >2% keeps rate hikes on the table

The latest Fed minutes suggest officials are open to rate hikes if inflation stays persistently above the 2% target. With the policy rate currently at 3.50%–3.75%, the tone points to a potentially more restrictive stance if inflation does not cool. For crypto traders, the key impact is how markets reprice policy expectations. Prediction markets have turned more hawkish: the “Fed Rate Hike in 2026” contract rises to 31.5% YES, while “Fed Rate Cut by June 2026” drops to just 1.2% YES. That implies reduced near-term cut odds and a higher probability that easing could be delayed beyond mid-2026. Catalysts to watch are the next FOMC meeting and upcoming inflation and employment data, plus speeches from Fed Chair Jerome Powell and other officials. Any changes in major financial institutions’ forecasts could further shift sentiment and volatility across crypto risk assets via higher-for-longer yields and tighter financial conditions.