Polymarket bettors now see a 94% probability the Federal Reserve will hold interest rates steady at its next meeting, following softer US inflation data released this week. The shift in odds boosted Bitcoin sentiment and helped crypto investment products snap an $8 billion outflow streak, ending weeks of selling pressure.
Polymarket sees near-certainty for Fed hold
Prediction-market odds on Polymarket surged to 94% late Wednesday, up from roughly 70% a week ago. The move reflects traders' conviction that the central bank will keep rates unchanged after the latest inflation report showed a slower pace of price increases than expected. The remaining 6% probability is split between a quarter-point cut and a hike, with the latter now seen as virtually impossible.
Bitcoin sentiment lifts on inflation data
Bitcoin prices edged higher following the inflation print, with traders interpreting the data as a sign that the Fed's tightening cycle may be over. The softer numbers eased fears of further rate hikes, which had weighed on risk assets including crypto. The move was part of a broader rally in digital assets, though gains were modest compared to the sharp outflows seen in previous weeks.
Crypto fund outflows reverse
Institutional crypto investment products recorded net inflows for the first time in a month, ending an $8 billion outflow streak. The reversal came as the weaker inflation data prompted investors to reassess the macroeconomic outlook. Products tracking Bitcoin and Ethereum led the turnaround, though the inflows remain small relative to the prior outflows. The shift suggests some investors are regaining confidence, but the total volume is still below what was seen earlier in the year.
The Fed's next rate decision is set for later this month, and the market will be watching the official statement closely for any change in language. For now, the odds are heavily stacked in favor of a hold.
