US Federal Reserve expected to hold interest rates steady as crypto markets brace for volatility

The Federal Reserve is almost certainly going to do nothing this week. And somehow, that’s the most important financial event of the month. The FOMC meets July 29-30 with the benchmark interest rate sitting at 3.5% to 3.75%, and the overwhelming consensus is that it stays right there. But a small, well-capitalized corner of Wall Street thinks the consensus is wrong, and that possibility alone has crypto traders paying very close attention. The case for standing pat Fed Chair Kevin Warsh, who took the helm earlier this year, has made his priorities clear. He wants inflation lower and has publicly stated that “prices are too high.” That’s not exactly a man who sounds ready to cut rates. The CME FedWatch tool and platforms like Kraken currently show a 25-36% probability of a 25 basis point increase at this meeting. In English: roughly one in three odds of a hike, which sounds modest until you remember that one in three is also the probability of rolling a 1 or 2 on a die. It happens more often than people think. The vast majority of analysts, however, expect Warsh to keep his powder dry. Geopolitical tensions have kept oil prices elevated, adding a supply-side dimension to the inflati...