- FedWatch data shifts show rate cut probability increase for January 2026.
- Crypto markets, notably BTC and ETH, experienced heightened activity.
- Uncertainty surrounding future Fed meetings continues to affect market volatility.
CME Group’s latest FedWatch data, released on December 28, indicates a 17.7% probability of a 25 basis point rate cut by the U.S. Federal Reserve in January.
The increased probability of a rate cut could influence BTC and ETH prices, reflecting the crypto market’s sensitivity to U.S. monetary policy expectations.
FedWatch Signals Rising Rate Cut Chances for Early 2026
CME’s FedWatch data recently highlighted an increase to 17.7% in the likelihood of a 25 basis point rate cut by the Federal Reserve in January 2026. This adjustment reflects ongoing assessments of economic indicators and monetary policy expectations. Prior to March 2026, predictions show a 46.7% probability for unchanged rates and a 45.6% chance for a 25 basis point cut.
Cryptocurrency markets, especially Bitcoin (BTC) and Ethereum (ETH), closely follow these developments due to their influence on market volatility and trading volume. Many market participants consider these shifts as indicators for macroeconomic direction impacting short-term investment strategies. It appears that there are no available quotes or commentary from key players, leaders, or experts regarding the recent FedWatch update from December 28. Unfortunately, due to the lack of primary source statements identified, there are no relevant quotes to provide in the requested format.
Lack of public commentary from Federal Reserve officials and major crypto industry leaders leaves interpretations to analysts, while the crypto community speculates on potential outcomes for market positioning. Investors remain vigilant awaiting any official statements from key figures.
Bitcoin and Ethereum React Amid Speculation and Volatility
Did you know? In past cycles, FOMC meetings often triggered notable market volatility across sectors, including cryptocurrencies. Bitcoin and Ethereum historically experience price swings before and after Federal Reserve announcements, reflecting broader economic sentiment.
Bitcoin (BTC) currently trades at $87,794.02 with a market capitalization of 1.75 trillion and a dominance of 58.95%, as reported by CoinMarketCap. Over the past 24 hours, its trading volume reached 13.51 billion, marking a decrease of 52.14%. Price movements include a slight 0.28% increase in the past day and a 21.87% decline over the last 90 days.
Bitcoin(BTC), daily chart, screenshot on CoinMarketCap at 08:47 UTC on December 28, 2025. Source: CoinMarketCapThe Coincu research team’s analysis suggests these Fed rate expectations may lead to increased volatility in financial markets. Historical patterns indicate that changes in interest rate projections can spur fluctuations in crypto asset values, as investors gauge fiscal and regulatory impacts on digital currencies. Fed rate expectations might significantly influence market dynamics as they continue to evolve.
| DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing. |
Source: https://coincu.com/markets/fedwatch-increases-rate-cut-probability/
