The main market focus is on the release of the minutes from the most recent FOMC meeting, the U.S. monetary policy committee.
Bitcoin (BTC) shows a slight decline on the morning of this Wednesday (28), trading in the range of $108,000. Among the main cryptocurrencies in the world, the scenario is mixed, with a predominance of negative variations.
In the traditional market, Asian indices had a mixed performance in yet another trading session. Meanwhile, European stock markets and Wall Street futures are operating in decline this morning.
The main market focus is on the release of the minutes from the most recent FOMC meeting, the U.S. monetary policy committee.
The document is expected to be released at 3 PM, providing the views of the members of the Federal Reserve (Fed, the Central Bank of the United States) on the future of U.S. interest rates.
With the absence of relevant news for risk assets, stock markets and cryptocurrencies have entered a correction zone, awaiting more significant changes in the scenario.
See the performance of the ten largest cryptocurrencies in the world today:
Source: Coin Market Cap.
Bitcoin ($BTC ) and interest rate policy
According to data from CME Group, which tracks market expectations for interest rates, most financial traders anticipate the first rate cut later this year, in September.
However, for the upcoming FOMC meetings, the prevailing expectation is to maintain the basic interest rate at the current level of 4.25% to 4.5% per year. It is important to remember that a reduction in interest rates generally boosts the price of cryptocurrencies and other risk assets.
Thus, any information diverging from what analysts and investors expect in the minutes could alter these projections, both for a negative scenario — as well as a positive one.
This is because U.S. President Donald Trump has been pressuring the Federal Reserve for a change in U.S. interest rate policy. Conversely, inflation in the U.S. remains high, a factor that tends to postpone a possible rate cut to a future moment.