Dissent and more: 3 things to watch for at the Fed meeting

The Federal Reserve will announce its interest-rate decision at 2 p.m. ET (18:00 UTC), followed by Chair Kevin Warsh's press conference half an hour later.

Here are key themes to watch for that may influence interest-rate expectations and markets.

Dissent: The Federal Open Market Committee (FOMC) is expected to keep the benchmark interest rate unchanged in the 3.75%–4% range. That outcome has been widely anticipated since the September projections, when most officials penciled in just one more rate increase this year, with December seen as the most likely timing.

That makes any dissent particularly significant. If three or more voting members opposed holding rates steady and instead favored raising, that would signal growing urgency among policymakers to tighten policy and fuel expectations of more aggressive hikes in the coming months. That could bolster the Dollar Index and potentially weigh on bitcoin BTC$80,690.83.

Comments on financial conditions: The 10-year Treasury yield has pulled back to 5%, a 36 basis-point drop since Oct. 7. The 30-year yield has declined by 40 bps. This has eased financial conditions, which track credit availability in the economy, with a knock-on effect on risk-taking in financial markets. If Warsh acknowledges this easing, it could amp up bets on rate increases in the coming months.

Warsh’s comments on inflation: Consumer price inflation has come in above expectations for two consecutive months. Oil prices remain elevated near $100, and U.S. diesel prices are at record highs. Warsh’s thoughts on the subject could influence the market. Moreover, high energy prices provide little room for him to express bias for growth over inflation.

Bitcoin is rising before the meeting. It was recently trading at $81,411, up more than 2% over 24 hours. Ether ETH$2,342.29, solana (SOL) and XRP (XRP) have also gained more than 2%.

What’s trending

• Google to preview crypto custody security system as AI threats grow (CoinDesk): Google will showcase a new security system, Google Multi-Party Compute, designed to help banks and other financial institutions safeguard and move cryptocurrencies and tokenized assets.
• Here's how much bitcoin and the S&P 500 could rally after midterms (CoinDesk): Since its inception in 2009, bitcoin has seen four U.S. midterm elections. Excluding 2010, when the market was tiny and fringe, the other three saw BTC prices rise an average of 54% in the following 12 months, according to data analyzed by CoinDesk.
• Bitcoin treasury Datavault AI plunges 50% after firm says it can’t access its BTC (CoinDesk): Datavault AI (DVLT) plunged nearly 50% after a filing revealed that the company had been unable to withdraw bitcoin from crypto exchange Biconomy since June and would have to restate its financial results.
• Treasury yields tick higher ahead of Federal Reserve interest rate decision (CNBC): Bond yields rose early Wednesday before the Federal Reserve’s latest monetary policy decision. The 10-year Treasury note yield added more than 2 basis points to 5.0134%.

Today’s signal

The chart shows swings in the Dollar Index (DXY) since January this year. The index tracks the greenback’s value against a basket of fiat currencies.

The DXY has danced to the tune of Fed Chair Kevin Warsh in the months after interest-rate meetings, as ING points out.

That makes today’s FOMC meeting all the more important. What the dollar does from here could have a bearing on all markets, including cryptocurrencies.