Key macro data is scheduled for release this week, including the January FOMC meeting and the US jobs report for January. Markets have already priced in the central bank’s policy rate to remain in the range of 5.25-5.50% in March. The probability of this scenario is estimated at 97.6% according to CME Group FedWatch Tool.
Historically, when rate forecasts exceed 90%, the Fed acts in line with the consensus forecast. Thus, no significant market reaction to the Central Bank’s decision should be expected as no change in policy is priced in. Of much greater interest is the May meeting, where the odds of a rate cut are currently estimated at 89.3%.
The regulator's March meeting still looks touch and go due to patchy macro data. The key event will be Fed chair Jerome Powell’s press conference, which investors will be parsing for further policy easing signals.
BTC is expected to pass the $45k level after February 10 and then trend gradually upward towards $50k by the end of February, at which point the market will start to get ready for the upcoming halving event.