#FOMCMeeting

With the Federal Reserve's FOMC meeting on June 17 and 18 underway, the market has almost completely priced out the possibility of a rate cut this month. According to the latest CME FedWatch tool, there is now a 99.6% probability that the Fed will keep interest rates unchanged in June, with only a 0.4% chance of a 25 basis point cut. Expectations for the first rate cut have shifted even further down the calendar, with September now showing about a 60% chance of a possible easing.

This persistent stance of "higher for longer" reflects the Fed's cautious approach amid still high inflation and signs of resilience in the labor market. Recent economic data suggest that inflation remains persistently near the Fed's 2% target, while job growth continues to surprise on the upside. As a result, policymakers are opting to wait for clearer signals before making any rate adjustments.

For crypto and other risk asset investors, this delay in rate cuts could mean continued volatility in the short term. Assets like Bitcoin and Ethereum, which often thrive in looser monetary environments, may struggle to gain sustained upward momentum in the coming weeks. However, sharp price declines may present strategic buying opportunities for long-term holders, especially as institutional interest in crypto remains strong.

The key macroeconomic catalysts to watch in the short term are the upcoming inflation reports (such as CPI and PCE) and labor market updates. A weaker inflation report or signs of economic slowdown could reignite dovish sentiment and increase risk appetite in crypto and stocks.

Given the current macroeconomic landscape, investors should remain defensive but flexible.