Dow Jones Inches Up as Markets Hold Breath for Fed’s Rate Verdict

Wall Street treads cautiously higher—every eye locked on Jerome Powell's next move.

The Fed's looming decision hijacks all momentum. Traders hedge bets, parsing every data point for clues. No one wants caught offside when rates drop—or spike.

Traditional markets cling to central bank whispers. Meanwhile, crypto doesn’t wait for permission. Bitcoin barely flinches—decentralized finance grinds on, unbothered.

Another reminder: while legacy finance obsesses over quarterly guidance, blockchain runs 24/7. No Fed meeting needed.

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A 25 bps reduction is the overwhelming expectation with 94.1% odds, according to CME’s FedWatch tool. At the same time, a 50 bps cut is also possible, although very unlikely, with a slim 5.9% chance.

JPMorgan’s Rate Cut Scenarios

JPMorgan believes a “dovish” cut is the most likely scenario with a 47.5% chance, which it expects will push the market higher by 0.5%. When the Fed is dovish, it signals that rate cuts will likely continue in order to support economic growth.

In addition, the odds of a “hawkish” cut are also elevated at 40%. A hawkish Fed signals that a rate cut may be a one-off event and that rates must stay elevated until inflation is under control. JPMorgan expects this scenario could leave the market flat or push it lower by up to 0.5%.

The bank assigns a 7.5% chance of a 50 bps cut, which could shock the market and result in market moves ranging from a 1.5% decline to a 1.5% gain. The Fed maintaining rates and raising them are also unlikely scenarios, with odds of 4% and 1%, respectively.