Analysis: Market expects the Federal Reserve to pause interest rate cuts this week. Powell's dovish or hawkish signals may influence Bitcoin's price movement.

BTC-1,35%

PANews January 26 News, according to CoinDesk reports, the market generally expects the Federal Reserve to keep interest rates unchanged this Wednesday. The key focus of this meeting lies in the statements made by Fed Chair Jerome Powell during the post-meeting press conference, as his remarks could provide directional guidance for risk assets (including Bitcoin). The core market concern is whether this pause in rate hikes will be interpreted as an “hawkish pause” or a “dovish pause.” If Powell emphasizes inflation risks, it could dampen rate cut expectations and pressure risk assets; conversely, if he hints that the pause is temporary and leaves the door open for rate cuts in the coming months, it could boost risk assets like Bitcoin. Additionally, if officials appointed by Trump oppose the rate decision, it may reinforce market expectations for future easing policies.

Powell’s explanation for maintaining the interest rate could support the dollar, thereby exerting pressure on Bitcoin priced in USD. He may also be asked about recent housing affordability measures by the Trump administration (which could raise short-term inflation), ongoing judicial investigations into him personally, and bond market volatility triggered by Japan, all of which could increase market volatility.

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