Fed Dec 9–10 Meeting: What to Expect for Bitcoin, Gold and Stocks as 25 bps Cut Looms
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Key Takeaways
The next meeting of the Federal Market Open Committee (FOMC) will take place on March 19 and 20.
Bitcoin displayed a mixed immediate reaction to neutral interest rate decisions in previous meetings.
Will BTC increase if interest rates stay constant after the FOMC meeting?
The second meeting of the US Federal Market Open Committee (FOMC) this year will take place on March 19 and 20. It is expected the committee will keep interest rates constant at between 5.25 and 5.5%. In previous FOMC meetings, particularly those where interest rates remained unchanged, Bitcoin had a mixed initial response, often experiencing fluctuations straight after the announcement.
This, however, raises a question: how will BTC fare in the aftermath of the forthcoming meeting, and is there a historical pattern of reacting to FOMC decisions?
What Happened in the Previous FOMC Meetings?
The most recent FOMC meeting happened on January 30 and 31. In it, the committee decided to keep the interest rates constant at the 5.25 to 5.5% range. The committee arrived at the same decision in the previous three meetings, which took place in September, November and December 2023, respectively.
After the January 2024 meeting, FOMC’s official statement said:
:The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.
Therefore, interest rates are expected to remain the same after the March meeting. The last time the committee raised interest rates was in July, when the committee voted to rase them by 0.25%.
All in all, the committee has maintained the same interest rates in five of the previous meetings and raised them in four (February, March, May and July).
How Did Bitcoin React to FOMC Interest Rate Increases?
As outlined above, interest rate hikes happened in February, March, May and July last year. Interestingly, the Bitcoin price increased three out of the four days after the FOMC announced the increases. So, the immediate reaction of the BTC price right after the meeting was positive.
While this seems counterintuitive, it could have happened because the increase was lower than expectations, hence causing a positive reaction.
BTC/USD Daily Chart: Credit – TradingView
Additionally, the BTC price reached a local top shortly after the meeting in all four cases. It reached the top within three days of the first three meetings and roughly two weeks after the July one.
How Did BTC React to Neutral Interest Rate Decisions?
The FOMC freezed interest rates in June, September, November and December 2023 and January 2024. Like the day after interest rate increases, the reaction the day after interest rates remained constant was mixed. The BTC price fell three times and increased twice.
BTC/USD Daily Chart: Credit – TradingView
However, the BTC price reached a bottom shortly after each meeting and began an upward trend afterwards. The upward movements had various rates of increase, the biggest being the 75% increase after the January 2024 meeting that led to BTC’s all-time high.
Expectations vs Reality Can Determine Reaction
The BTC price does not seem to have a set reaction to an interest rate increase or a neutral decision. Rather, it could be possible that the increase or decrease relative to the expectations is what determines the direction of the movement the day of the meeting.
An interesting observation was that BTC often reaches a top a few days after an interest rate increase and a bottom a few days after a neutral decision. If interest rates stay the same and they follow their previous pattern, BTC will reach a bottom shortly after the meeting and begin another upward trend.
Valdrin Tahiri is a cryptocurrency analyst and reporter at CCN, specializing in technical analysis with a focus on Elliott Wave theory, on-chain metrics, and fundamental research. He brings over seven years of experience in the crypto space as both a trader and writer.
He discovered cryptocurrencies in 2017 while earning his MSc in Financial Markets at the Barcelona School of Economics, which sparked a deep interest in blockchain and market dynamics. Since then, he’s contributed to top crypto outlets like BeInCrypto and CoinGape.
Valdrin also served as Community Manager of BeInCrypto’s Telegram group for three years, helping grow it into one of the largest crypto communities worldwide. His expertise in market structure and price patterns allows him to break down complex trends into clear, actionable insights.
He’s published thousands of articles covering altcoins, Bitcoin cycles, and macro trends.
