Fed cut di rate reach 0% as Kevin Warsh take chair
Kevin Warsh don swear in as new Federal Reserve chair, and President Trump tok say Warsh go remain “independent” for interest-rate policy. Traders wey dey use CME FedWatch don price Fed rate cuts for 2026 as 0%, wey dey shift market toward possible hikes.
For di next FOMC on June 17, CME show only 3.5% chance for 25 bps hike, wey go rise to ~17% for di July meeting and about 67% for di December meeting. With federal funds target range still at 3.50%–3.75%, dis lack of easing path and rising policy uncertainty fit pressure risk assets.
For crypto traders, di key takeaway na say di Fed rate cuts story dey break down. Tighter liquidity expectations and higher near-term volatility risk fit weigh on Bitcoin, even as cheaper credit fit also keep inflation pressure on the Fed.
Bearish
Bearish for Bitcoin. Di latest pricing don remove di main tailwind for risk assets: Fed rate cuts for 2026 don basically comot from table (0% probability). Instead, CME dey show solid chance say dem fit raise rates later dis year (specially around December). For BTC, dat usually mean tighter dollar-liquidity expectations and less reason make people go “risk-on”.
Short-term, dis fit make volatility rise round upcoming FOMC events as traders dey reprice discount-rate assumptions. Long-term, if Fed no fit credibly signal easing, market fit maintain a higher-for-longer regime, wey historically dey cap upside for high-beta crypto. Even if lower rates usually dey help, di article talk say cheaper credit fit still keep inflation pressure up—reducing confidence in a clean easing cycle.