Today’s FED meeting could propel Bitcoin to the moon or start another bearish move

• The upcoming FOMC meeting will highlight what the crypto community should expect to happen to the market in the coming weeks as Bitcoin sees an uptrend in price.
• After weeks of consolidation for the leading digital asset, BTC recorded a brief bounce following positive CPI data released recently.

Over the past seven days, the largest crypto asset by market capitalization, Bitcoin (BTC), has registered a small gain of more than 1.5 percent as the crypto ecosystem prepares for another roller coaster ride. The expected release of the Consumer Price Index (CPI) data will be a game changer for BTC and the entire crypto market.

What to expect from the FOMC’s meeting

December 14 marks the last meeting of the Federal Open Market Committee (FOMC) of the year. As expected, members must assess and release their updated forecasts for inflation and a possible interest rate increase. The Fed will also release its final dot plot report for the year.

This dot plot is released only four times a year – March, June, September and December and represents a chart of the FOMC’s economic forecasts, such as unemployment, gross domestic product (GDP) and projected inflation for the months ahead. Furthermore, based on the dot plot, all committee members are expected to publish their opinions on the long-term impact of a potential rate hike.

Investors, in turn, can use the market information to see how the compromise on long-term interest rates may affect the broader financial markets. As a result, market participants and BTC investors will be paying close attention to the official inflation forecast for next year and the expected interest rate for the same period.

According to renowned economic journalist Colby Smith, the latest dot plot reflected the decision of most members who voted for a 50 basis point freeze for December. However, the question looming in the coming week is whether the Jerome Powell-led Fed will favor a slow rate hike of 25 basis points.

Will Bitcoin See a Year-End Rally?

After weeks of consolidation for the leading digital asset, BTC recorded a brief bounce following positive CPI data. In addition, the US Labor Department reported that previous CPI results have been dismal, with a jump of about 0.1 percent between October and November. That’s why the Fed raised inflation rates last month by 7.1 percent against forecasts of 7.3 percent. Meanwhile, the positive CPI data has pushed BTC towards the $18,000 price level, the first in recent weeks.

At the time of writing, BTC was trading at $17,833, after an increase of about 2.4 percent in the last 24 hours, according to current Coingecko data. As a result of the price surge, BTC hit a new four-week high, with investors closely watching the asset’s price movement for a bottom that could kick-start a new price uptrend. However, it is worth noting that negative CPI data and a tightening move by the Fed on inflation rates could disrupt any possible rally for BTC, as was the case in the April and August price reversals.

Based on the Fed’s recent antecedents, analysts expect the FOMC meeting results to indicate that the Fed will not raise interest rates aggressively.