by Coinstrooper Crypto Articles
Quick Take
  • The Federal Reserve (Fed) decides on interest rates this Wednesday.
  • If the Fed surprises, stocks, bonds, oil and Bitcoin (BTC) all move fast.
  • The Fed’s main interest rate has sat between 3.50% and 3.75% for four meetings.
  • Fed funds futures put the chance of a rate rise at 13% a week ago.

What Happened

That gap matters. If the Fed surprises, stocks, bonds, oil and Bitcoin (BTC) all move fast. Bitcoin traded near $64,915 on Monday, up 0.7%.

The Fed’s main interest rate has sat between 3.50% and 3.75% for four meetings. The FactSet consensus says it stays there.

Traders tell a different story. Fed funds futures put the chance of a rate rise at 13% a week ago. By Friday it had jumped to 38%. It now sits near 36%.

Market Context

“We are currently seeing the biggest indecision by the markets regarding the expected outcome for some time,” analyst The Martini Guy noted.

The two camps are not really arguing. Economists name the single likeliest outcome. Futures price every outcome, including the unlikely ones.

Oil is the trigger. Brent crude closed at $100.69 on July 23, its first close above $100 since May 26. Prices are up over 30% this month.

Tariffs came next. On Friday, the US added new import taxes of 10% and 12.5% on goods from 60 trading partners.

Bond markets reacted. The 10-year Treasury yield closed Friday at 4.69%, its highest since January 2025. That is the rate the US government pays to borrow for a decade.

When safe bonds pay 4.69%, risky bets look less appealing. That has capped Bitcoin all month.

Why It Matters

The Federal Reserve (Fed) decides on interest rates this Wednesday. Almost every economist expects no change. Traders are far less sure.

Economists Say Hold, Traders Say Maybe Not

Reuters asked 104 economists in mid-July. All 104 said hold. Fully 78 expected no change through December.

Why the doubt? Chair Kevin Warsh has stopped hinting at what comes next. The Fed will not publish new forecasts either. That leaves traders guessing ahead of this week’s central bank decisions.

Gregory Daco of EY-Parthenon calls a July hike unlikely. Even so, he puts the rest of the year at 60-40. Larry Meyer, a former Fed governor, expects a hold but sees Lorie Logan and Beth Hammack voting against it.

Details

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The panel is also shifting. Most of those same economists now rate the chance of a hike later in 2026 as high. A month ago, most said low.

“Absent, also, is so-called forward guidance, which we agreed was not well suited to the current policy conjuncture,” said Warsh.

Oil and Tariffs Brought Inflation Back

Costlier oil means costlier fuel, and that lifts inflation. A weekend pause in Iran strikes has calmed things a little.

These replace tariffs the Supreme Court threw out in February, using a law that is harder to challenge.

The two-year yield is the real tell. It ended the week at 4.33%, above the Fed’s own 3.75% ceiling. Bond traders are already braced for higher rates.

What It Means for Bitcoin

Bitcoin trades near $64,915. That is roughly 49% below its record of $126,080, set in October 2025.

A rate rise would be the Fed’s first since July 2023, ending three years of pauses and cuts.