#FOMCMeeting

With the U.S. Federal Reserve’s May FOMC (Federal Open Market Committee) meeting approaching, the CME FedWatch tool currently indicates only a 2.7% chance of a 25 basis point rate cut in May. This shows that markets have mostly ruled out any near-term cuts, pushing expectations for rate reductions further down the line. This shift carries important implications for how investors should position their portfolios, especially when it comes to crypto and other risk assets.

When rate cuts are delayed, tighter liquidity conditions persist, putting pressure on speculative assets like cryptocurrencies, tech stocks, and other growth-driven investments. As a result, investors may want to take a more cautious stance, ensuring they aren’t overly exposed to high-volatility sectors that react sharply to changing interest rate expectations. However, it’s also important to monitor macroeconomic indicators, since any unexpected weakening in economic data or a more dovish tone from the Fed could quickly change market sentiment and favor risk assets again.

In short, maintaining a balanced portfolio — combining defensive holdings with selective exposure to growth sectors — can help investors navigate the uncertainties of future monetary policy.