All Eyes on the Next Fed Meeting: Market Trajectories Hinge on Decision

All Eyes on the Next Fed Meeting: Market Trajectories Hinge on Decision

Equities, precious metals, and cryptocurrencies have been on a tear during the last three weeks of 2023, and all eyes are now focused on the next Federal Open Market Committee (FOMC) meeting, which is 11 days away. On Friday, Federal Reserve governor Christopher Waller said that he favors a quarter-point benchmark rate increase at the next FOMC meeting. Analysts believe that current market trajectories will be dependent on the outcome of the next Fed meeting. Markets Still on Edge Ahead of Fed Meeting Despite Equities, Cryptocurrencies, and Precious Metals Rallying in 2023

On Saturday, Jan. 21, 2023, at 2:45 p.m. Eastern Time, the global cryptocurrency market capitalization was up 5.87% over the previous day and hovering around $1.06 trillion in value. The leading crypto asset, bitcoin (BTC), had climbed 11.63% higher against the U.S. dollar in the past seven days. The second-leading digital currency in terms of market valuation, ethereum (ETH), had risen 8.33% that week against the greenback. The increase in value of these two crypto assets has also increased the U.S. dollar value of the thousands of digital currencies below BTC and ETH. BTC/USD on Jan. 21, 2023, at 4:24 p.m. ET. By 4:24 p.m. on Saturday, the global crypto market cap was down to $1.05 trillion, according to market data, with BTC trading at $23,133 per coin.

The day prior, on Friday, Jan. 20, equity markets closed the day in the green. The top four benchmark stocks (S&P 500, Dow Jones, Nasdaq, and Russell 2000) ended the day between 1% and 2.66% higher against the U.S. dollar. The Nasdaq Composite was the highest, rising 2.66%, the S&P 500 rose by 1.89%, the Russell 2000 index (RUT) jumped 1.69% higher, and the Dow increased by 1% on Friday. U.S. equities have posted their second consecutive week of gains so far this year. The small-cap stock market index RUT has risen 7.1% this year, with small-cap shares leading the equities race in 2023. Closing percentage rises of the top four benchmark indexes on Friday, Jan. 20, 2023.

Precious metals have done well too with a troy ounce of gold trading for $1,927.30 per unitand silver trading for $24.01 per ounce. Like cryptocurrencies and stocks, precious metals have rallied in 2023, erasing the losses that took place in Dec. 2022. Gold enthusiast Peter Schiff believes the price of the precious yellow metal will grow higher this year. “Gold is now trading above $1,934, its highest price since April of 2022,” Schiff tweeted on Jan. 19. “Gold stocks, however, still haven’t even taken out last week’s high. In fact, gold stocks need to rise 30% from here just to get back to where they were trading in April of 2022. This sale may not last long,” he added. New York Spot Price for gold, silver, platinum, palladium, and rhodium as of Friday, Jan. 20, 2023.

Speaking with Kitco News, OANDA senior market analyst Edward Moya detailed that gold prices will remain indifferent until the Federal Reserve’s February 2023 meeting. “It’s going to be choppy,” Moya said. “I’m neutral on gold until the Fed’s meeting on February 1. Major resistance is at $2,000. But I would be surprised if we move above $1,950. We’re likely to consolidate here until the Fed meeting,” the market analyst added. Market analysts and macroeconomic experts have no idea what the Fed will do at the FOMC meeting. Some believe an aggressive tightening schedule will continue, while others expect the Fed to ease up and pivot with a ‘soft landing.’

The Biden administration and White House economist Heather Boushey told Reuters that current leaders do not expect a recession. “The steps have been taken and it looks like we’re in a very good position to have that soft landing that everyone’s talking about,” Boushey insisted. On Friday, Federal Reserve Governor Christopher Waller told reporters at a Council on Foreign Relations conference in New York that he favors a smaller rate hike than the previous seven. So far, the Fed has implemented seven rate hikes in 2022, two of which were half-point rises and five were three-quarter-point increases. Waller can envision a quarter-point increase at the next FOMC meeting next month.

“I currently favor a 25-basis point increase at the FOMC’s next meeting at the end of this month,” Waller told the press. “Beyond that, we still have a considerable way to go toward our 2 percent inflation goal, and I expect to support continued tightening of monetary policy,” the Fed governor added.

It’s quite likely that all three major markets (precious metals, cryptocurrencies, and stocks) will react in some way or another after the Fed’s next decision. Many believe the next FOMC meeting decision will be entirely dependent on inflation gauges. U.S. President Joe Biden has been tweeting about the U.S. economy during the course of the weekend as he believes the country is on the road to recovery. “Annual inflation has fallen for six straight months and gas is down $1.70 from its peak,” Biden tweeted on Saturday morning at 10:25 a.m. Eastern Time. “We’re successfully moving from economic recovery to stable growth,” Biden added. Tags in this story benchmark rate increase, Bitcoin, BTC, Christopher Waller, Council on Foreign Relations, Cryptocurrencies, cryptocurrency market capitalization, dow jones, economic recovery, economics, Economy, Edward Moya, equities, equity markets, ETH, Ethereum, Federal Open Market Committee (FOMC), Federal Reserve, Global Economy, gold, gold price, Heather Boushey, inflation, Joe Biden, Kitco News, market trajectories, nasdaq, next Fed meeting, OANDA, Peter Schiff, Precious Metals, Russell 2000, S&P 500, silver, Silver Price, small-cap shares, stable growth, Stocks rally, U.S., U.S. dollar, US economy

What do you think the outcome of the next FOMC meeting will be and how do you believe it will affect the current market trajectories for equities, precious metals, and cryptocurrencies? Let us know what you think about this subject in the comments section below. Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today. Switzerland Less Affected by Crypto Industry Crisis, Study Finds ECONOMICS | 12 hours ago Saudi Arabia Open to Trading in Currencies Other Than US Dollar, Signaling a Shift Toward De-Dollarization ECONOMICS | 2 days ago

Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleObjections Raised Over Appointment of Sullivan & Cromwell as Debtors’ Counsel for FTX Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItDraft Law Regulating Aspects of Crypto Taxation Submitted to Russian Parliament

A bill updating Russia’s tax law to incorporate provisions pertaining to cryptocurrencies has been filed with the State Duma, the lower house of parliament. The legislation is tailored to regulate the taxation of sales and profits in the country’s market ... read more.SEC Risks Violating Admin Procedure Act by Rejecting Spot Bitcoin ETFs, Says Grayscale Bitcoin ATM Operator Indicted in New York Allegedly Running Illegal Business Attracting Criminals Bill ‘On Digital Currency’ Caps Crypto Investments for Russians, Opens Door for Payments Australia to List Bitcoin ETF After 4 Clearinghouse Participants Commit to Meet Stringent Margin Terms