With the U.S. Federal Reserve’s next interest rate decision set for Wednesday, May 7, 2025, the markets appear overwhelmingly confident in one thing: a rate cut isn’t coming.
Crypto analyst Michaël van de Poppe shared a chart indicating that 97.2% of market participants expect the Fed to hold rates steady at the current target of 4.25% to 4.50%. Only 2.8% believe a cut to 4.00%-4.25% is possible, and 0% expect a rate hike.
This data—pulled from the Fed Funds Futures market—underscores a strong consensus that the central bank will remain in a holding pattern, prioritizing inflation control over economic stimulation for now.
A Surprise Could Shake the Market
Despite the overwhelming odds, van de Poppe notes:
“Would be a great surprise for the markets if a rate cut does happen.”
Indeed, any deviation from expectations—especially a surprise rate cut—could send shockwaves through equities, crypto, and bond markets, igniting short-term volatility and possibly sparking bullish momentum in risk assets like Bitcoin and Ethereum.
Why It Matters for Crypto
Interest rate decisions significantly influence liquidity and risk appetite in markets. A rate hold signals a neutral stance, whereas a cut often injects optimism into speculative assets, making this decision particularly pivotal for the crypto sector.
As the Fed prepares to make its move, all eyes remain fixed on Wednesday.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/fed-decides-on-cutting-rates-on-7th-of-may-crypto-markets-poised-for-volatility/