Recently, I thoroughly reviewed the Federal Reserve's December FOMC meeting minutes. To be honest, the policy signals are quite complex. The officials are generally aligned on continuing rate cuts as inflation continues to decline, but when it comes to "when to act" and "how much to cut at once," disagreements emerge, making it impossible to reach a consensus.

From the minutes, it’s evident that the decision-makers are somewhat conflicted — the market currently predicts a high probability (around 85%) that the next meeting will hold steady and keep rates unchanged. The ongoing debate revolves around the old question: is inflation more damaging to the US economy, or is the risk of worsening employment conditions more pressing? Many officials in the minutes indicated they want to wait for upcoming labor and price data before making further judgments.

The problem lies here — new data released after the meeting has made the situation even more uncertain. The November unemployment rate jumped to 4.6%, the highest since 2021, and consumer price increases were lower than expected, giving dovish advocates more leverage. However, on the other hand, the US Q3 GDP growth rate surged to 4.3% annualized, reaching a two-year high, which raises concerns that inflation might resurface.

Looking at the crypto market, this situation has a very direct impact on BTC and the overall market. The Federal Reserve’s actions and market liquidity are core macro factors for the crypto space. With such policy uncertainty and expectations of maintaining the status quo in January, capital has become more cautious. Plus, with the New Year’s holiday approaching, European and American traders are gradually withdrawing, leading to insufficient market liquidity. As a result, BTC has been oscillating narrowly around $88,600, with no clear direction yet.