The cryptocurrency market saw a surge and lots of buying activity after Donald Trump returned to the White House. With Trump signing several executive orders that support the cryptocurrency market, more people are interested in trading. Next week is important for the market as the Federal Open Market Committee (FOMC) meeting and interest rate decisions, along with other important economic news, will likely influence future market trends.
Markets remain stable and optimistic under new Trump policies
This week, everyone has been focused on US President Trump’s policies after he takes office, and it seems that the markets are handling him quite well so far. Instead of worrying, his ads actually make people more optimistic. He talked about big investments in artificial intelligence (AI), making significant changes in crypto policy, keeping interest rates low, and controlling inflation by reducing oil prices. This encouraged investors to take more risks, leading the S&P 500 to hit a new record high.
Also read: Bitcoin Price Prediction 2025: Will BTC Break $109,000 and Hit a New All-Time High?
As we head into a new week, several important events could shape future trends in the cryptocurrency market.
US earnings season
Next week, major technology companies like Microsoft, Meta Platforms, Tesla and Apple are expected to report their earnings. Analysts predict that these major players, along with three other major companies, will see their profits increase by more than 17% over the next year, almost double the 9% growth expected from the other 493 companies.
Because these companies are highly valued, investors will likely be looking for more than just the usual earnings and revenue numbers.
US FOMC meeting
The Federal Reserve is widely expected to keep its main interest rate unchanged this Wednesday as they wait for more information showing inflation is falling.
At the World Economic Forum in Davos, Switzerland, Trump said he would insist on immediate global interest rate cuts, revisiting his frequent but ineffective pressure on the Fed during his first term. At the start of his second term, Trump has already tightened immigration and announced plans to increase import taxes starting February 1.
This creates uncertainty for the Fed, making it difficult for them to plan monetary policy. The Fed will meet soon and is expected to keep the current interest rate between 4.25% and 4.50% as recent data supports a gradual approach to reaching their 2% inflation target.
Fed Chair Jerome Powell and her team face the challenge of balancing current monetary policy with uncertainties about the future and deciding how much to reveal about the Fed’s outlook.
United States Personal Consumption Price Index (PCE)
In November, overall U.S. PCE prices rose 2.4% from a year ago, which was an increase from the three-year low of 2.1% seen in September. The core PCE price index, which the Fed uses to gauge underlying inflation, rose just 0.1% – the smallest increase in six months. This kept the annual base PCE rate stable at 2.8% in December, which was lower than the expected 2.9%.
Looking ahead, overall PCE is expected to reach 2.6% year-over-year, which will be announced on Friday. The core PCE inflation rate is also expected to remain stable at 2.8%.
European Central Bank (ECB) interest rate decision
The ECB is expected to cut interest rates by 0.25% at its next meeting on January 30, bringing the rate down to 2.75%. This would be the fifth rate cut since June 2024, aimed at supporting economic growth.
Conclusion
With the Fed likely on pause, the ECB ready to cut rates and Trump’s pro-Crypto signals still fresh, the crypto market appears positioned for a generally optimistic week ahead. However, traders should be prepared for volatility around the FOMC announcement and major corporate earnings releases.