🇺🇸 Probability of a Fed rate hike in December reaches 100%! Will Bitcoin and gold face greater pressure?
According to the latest CME FedWatch data, the market currently expects the Federal Reserve to raise rates at its December 2026 policy meeting, with the overall probability reaching 100%.
Specifically:
📊 Market expectations:
- 25-basis-point hike: 90.8%
- 50-basis-point hike: 9.2%
- No change in rates: 0%
- Rate cut: 0%
The current target range for the US federal funds rate is 3.75%-4.00%.
If rates are raised by 25 basis points, they will rise to 4.00%-4.25%; if raised by 50 basis points, they could reach 4.25%-4.50%.
What does this mean for the financial markets?
1️⃣ Bitcoin (BTC): Expectations of higher interest rates could reduce risk appetite and increase short-term selling pressure.
2️⃣ Gold (GOLD): If the US dollar and Treasury yields strengthen, gold could remain under pressure.
3️⃣ US dollar (DXY): Expectations of higher interest rates could support the dollar.
4️⃣ Cryptocurrency market: If more leveraged long positions are liquidated, short-term volatility could intensify further.
My view:
The market has already fully priced in the expectation of a December rate hike, so what truly affects market movements may be not only the hike itself, but more importantly the Fed's guidance on future policy.
If the Fed signals a more hawkish stance, Bitcoin and gold could face further downward pressure.
However, if the rate-hike expectation has already been priced in, a rebound following a 'buy the rumor, sell the news' reaction cannot be ruled out.
⚠️ Market probabilities do not equal the Fed's final decision. Investors should manage risk carefully and avoid excessive use of leverage.
Do you think the Fed will raise rates by 25 or 50 basis points in December? Will Bitcoin break below key support levels? Share your thoughts!
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