Federal Open Market Committee (FOMC) meeting minutes suggest a possible interest rate hike, even as inflation cools. Officials are weighing a renewed focus on inflation versus the labor market before making rate decisions. The current federal rate remains between 3.50% and 3.75%, unchanged since December 2025.
The January 2026 inflation rate fell to 2.40%, nearing the 2% target. However, Fed officials indicate a pause in rate cuts, with discussions potentially leaning towards an upward adjustment to interest rates. This approach aims to better manage inflation.
The labor market also remains a key consideration. The US unemployment rate saw a slight decrease to 4.3% in January 2026 from 4.4% in December 2025, with non-farm payrolls increasing by 130,000. A miscalculation could risk pushing inflation away from the desired 2% level.
This uncertainty is impacting the cryptocurrency market, which has seen a 1.55% drop in market capitalization. Reports indicate significant liquidations, with $38.73 million in total liquidations over the last 12 hours, affecting both long and short positions. Bitcoin specifically experienced higher short liquidations.
