Key Insights:
- The latest crypto news reveals that the odds of a Fed rate cut have dropped to 2.7% as US-Iran tensions push inflation higher.
- CME FedWatch shows a 97.3% chance of rates staying steady at 3.5%-3.75%.
- Janet Yellen warns that rising oil prices could prevent the Fed from cutting rates.
Amid escalating US-Iran tensions, crypto news is focusing on the Fed’s March rate decision. Traders are increasingly betting that the Federal Reserve will keep interest rates unchanged in March 2026. The market odds of Fed rate cuts have now plummeted to their lowest levels, as crude oil prices and inflation concerns rise.
According to the CME FedWatch tool, the odds of the central bank holding interest rates unchanged surged to 97.3%. That’s the highest since the US-Iran conflict. At the same time, bets on interest rate cuts have dropped to just 2.7%.
Markets see no chance of a rate hike, reflecting expectations that the Fed will maintain its current stance amid global uncertainties.
Crypto News: Fed Rate Cuts Seem Unlikely
The crypto community is now looking ahead to the Federal Reserve’s potential decision on interest rates. The FOMC meeting could take place on March 17 and 18. As per market expectations, the central bank could hold interest rates unchanged at 3.5%-3.75%. This comes after three consecutive Fed rate cuts.
The CME FedWatch tool data indicate that the community is less optimistic about a rate cut. The odds are low at 2.7% for a potential rate reduction. At the same time, the likelihood of a steady rate is high at 97.3%.
Traders are reportedly trading back their expectations for a Fed rate cut this year. This is due to mounting concerns about rising energy prices and inflation. Crude oil prices have continued to climb since the US launched a missile attack on Iran.
As both countries continue fighting, inflation has surged to 3%, above the Fed’s 2% target. These concerns amid the ongoing Middle East issues cast doubt over the central bank’s potential interest rate cut.
Another major crypto news worth noting is the digital asset industry’s resilience amid the ongoing war. Despite escalating tensions, crypto prices remain steady, even though they initially saw significant volatility.
Inflation Risks Keep Rate Cuts on Hold, Says Janet Yellen
Contributing more to the prevailing uncertainty over the Federal Reserve’s decision, former Treasury Secretary Janet Yellen warned that the US-Iran conflict could push inflation even higher. This could block the Federal Reserve from reducing interest rates. She stated,
“I think the recent Iran situation puts the Fed even more on hold, more reluctant to cut rates than they were before this happened.”
Yellen added that the central bank is cautious about cutting rates. This is mainly due to the rising inflation. According to Yellen, the Fed’s main focus is on keeping prices stable and managing inflation. With inflation still above target, the central bank needs to be careful before making any policy changes.
Now, the rise in oil prices driven by the Iran conflict is adding extra pressure. Yellen warned that if the Strait of Hormuz remains closed for longer, oil prices could remain elevated, worsening the situation.