The US Federal Reserve (Fed) January Federal Open Market Committee (FOMC) meeting minutes were released on Wednesday. Some members discussed that upward adjustments in the federal funds rate could be appropriate if inflation remains above target. Interest rates were kept steady in the 3.5-3.75% range at the January meeting; this came after falling to current levels from 4.5% in three cuts by the end of 2024. The minutes highlight the risk of inflation staying away from the 2% target and note that some members advocated keeping the policy rate steady for a while. The Consumer Price Index (CPI) rose to 2.4% with a 0.2% increase in January. The next FOMC meeting is on March 18; according to CME futures markets, the probability of no change in rates is 94%.
The Fed has been cutting rates since September 2024. Source: Trading Economics
Inflation and Rate Hike Discussions in Fed Minutes
The minutes emphasize that the disinflation process could be slow and uneven; they state that rate cuts would be appropriate if inflation falls in line with expectations. The Fed’s primary mandates are inflation and the labor market. The hawkish faction is waiting for disinflation to get on track before starting cuts. This hawkish tone has triggered risk aversion in crypto markets, increasing the pressure we’ve seen on our BTC detailed analysis pages.
Current inflation remains above the Fed’s target. Source: BLS
Bitcoin Price and Technical Indicators Under Fed Influence
Bitcoin is currently trading at 66.874,68 dollars, down 1.13% in the last 24 hours. RSI at 33.89 level is giving an oversold signal, while the overall trend is downward and Supertrend indicates a bear market. There is resistance above EMA 20: 71.641,91. Supports: S1 65.142,99 (strong, 78% score), S2 62.909,86. Resistances: R1 70.639,46 (69% score), R2 77.213,46. The Fed’s hawkish stance is also weakening BTC futures in the BTC futures market.
Crypto Mining and Loss Signals in Companies
Amid Fed news, Bitcoin mining company Hive announced a net loss of 91 million dollars due to accelerated depreciation, but increased its hash rate. Metaplanet recorded a 619 million dollar loss in Bitcoin valuation; its assets rose to 35.102 BTC. These developments show how macro pressure is affecting crypto companies.
Bitcoin’s Long-Term Security Concerns
On the other hand, Ethan Heilman, co-author of BIP-360, stated that Bitcoin’s transition to post-quantum security will take 7 years. While the Fed’s interest rate policy creates short-term volatility, BTC’s fundamental technological evolution continues. Investors can diversify with ETH detailed analysis.
Source: https://en.coinotag.com/fed-minutes-inflation-risk-highlights-interest-rate-hike
