🔍 The Federal Reserve's New Dot Plot Storm Is Coming

The first suspense of 2026: Will interest rates move again? The Fed remains in the 3.50%-3.75% range, neither easing nor tightening, and the market's long-anticipated "big liquidity injection" seems far off. After cutting 25 basis points at the end of last year, they immediately hit the brakes—this pace is a bit confusing.

The latest dot plot indicates that the rate cuts for the year might total only 25 basis points, with the target rate locked around 3.4%. Meanwhile, inflation expectations are pinned at 2.4%, and GDP growth even reaches 2.3%. How clear is this signal? The Fed's logic is straightforward: "The economy can still hold up, why cut rates?"

Wall Street is also divided. Major institutions like Goldman Sachs and Morgan Stanley agree that there will be two rate cuts this year, each of 25 basis points in March and June, bringing the final rate to between 3.00% and 3.25%. But JPMorgan is more pessimistic, betting on only one cut. How big are the disagreements? Some voices call for "no cuts," while extremists fantasize about a 150 basis point slash. Doves are betting on the new Fed chair—current Chair Powell will step down in May, and the leading candidate, Haskett, is known for his "dovish" stance on rate cuts.

A few optimists like Moody's predict three rate cuts totaling 75 basis points this year, but only if the labor market collapses and political pressure heats up. But this scenario is too niche; reality is quite stark. Unless the unemployment rate soars above 4.7% and inflation quickly returns to 2%, this "slow rate cut" show will likely run through the entire year.

The FOMC meeting on January 27-28 will reveal the new dot plot—will it be a dovish breakout or will hawks continue to dominate? This is not just about the crypto market but directly impacts global asset allocation. The digital asset market is holding its breath in anticipation.