Trump Predicts Aggressive FED Rate Cuts Ahead of 2026 FOMC Meeting

Former President Trump just dropped a bombshell prediction—expect more rate cuts from the Fed in 2026. The political heavyweight is forecasting a dovish pivot that could send shockwaves through traditional and digital markets alike.

The 2026 FOMC Outlook

Trump's call isn't just political noise. It's a direct challenge to current monetary policy narratives. If the Fed follows this path, it would signal a major shift in the fight against inflation—or a quiet surrender. Either way, it creates the kind of macroeconomic uncertainty where decentralized assets thrive.

Liquidity on the Horizon

More cuts mean more liquidity searching for yield. Where does that capital go when traditional bonds offer diminishing returns? Historically, it floods into risk assets. For crypto, that's rocket fuel. A looser monetary environment could accelerate institutional adoption, pushing Bitcoin and major altcoins toward new valuations.

The Digital Gold Narrative Strengthens

Every rate cut weakens the dollar's yield appeal. That strengthens the 'digital gold' thesis for Bitcoin as a non-sovereign store of value. It's a classic hedge against monetary policy whims—something Trump understands better than most central bankers, who still think printing money is a science and not a speculative art.

Trump's prediction might be a political play, but the market mechanics are real. If 2026 brings the rate cuts he expects, the rush into crypto won't be a trend—it'll be a stampede. Just another day in finance, where the most reliable indicator is often a politician betting against the experts.

The comments signal Trump’s push for faster growth and looser monetary policy, even as inflation remains above the Fed’s target. This stance strongly put the Federal Reserve’s independent working atmosphere on curtails. 

Now, the market experts see 2026 as to be volatile under politics and policy collide.

But, what does it actually mean for broader markets, especially for crypto?

Fed Rate Cuts vs Inflation as the Economy Holds Firm

The US economic condition entering 2026 looks stable but uneven. GDP surged 4.3% in Q3 2025, while most forecasts expect around 2% growth this year, with optimistic views NEAR 3% if pro-growth policies are delivered.

Unemployment stands at 4.4%, still low, but job creation has slowed sharply. Inflation is running 2.5%–2.7%, down from past highs but not yet at the central bank’s 2% goal. Tariffs averaging about 17% and reduced immigration are adding cost and labor pressures.

Fiscal support from the One Big Beautiful Bill Act (OBBBA), including tax rebates and business incentives, continues to support spending, AI investment, and infrastructure.

In these well-favoured conditions the central bank generally avoids more easing and maintains the market posture. However, Trump follows a simple logic: if markets are strong, cheaper money should fuel even faster growth rather than slow it down.

Critics warn this approach risks overheating the economy and weakening the Federal Reserve’s independence. Supporters argue it could unlock a powerful growth cycle in 2026, especially with fiscal stimulus already in play.

Pressure on the Federal Builds Ahead of Key Meeting

Currently, the federal reserve rate is at 3.50%–3.75%, remaining steady since the cut in December 2025. The next Fed interest rate meeting schedule announcement is on January 27th and 28th, where a hold is expected.

Now, with the President’s strong mounting for ease and his reservations against current Fed Chair Jerome Powell, whose leadership as chair is set to expire in May 2026, building an anonymous LAYER of uncertainties. The talk of a new chairman, with views similar to those of Trump, is becoming widespread.

This volatility majorly affects the risk assets and and the markets who are a subject of reactives to strong changes, like crypto. 

Fed Rate Decision Effects On Cryptocurrency

Cryptocurrencies like Bitcoin (BTC) and ethereum (ETH) often move opposite to Federal Reserve interact rates. 

Higher rates tend to push crypto prices down by raising borrowing costs and reducing risk appetite, while lower rates or expectations of interest cuts boost liquidity and drive flows into crypto. But markets might experience huge fluctuations when the rates are stuck or delayed.

Hopes for future rate cuts in 2026 have supported short-term rallies, with bitcoin reaching $93,000–$95,000, but fading expectations for early easing have caused volatility and some profit-taking.

Currently, things look good for 2026, but delicate, with investors hanging on every word from the Federal Reserve and Trump and the January 27–28 FOMC meeting.