Thomas Lee, the Head of Research at Fundstrat and a notable figure who previously forecasted Bitcoin’s price hitting $150,000, has shared his perspective on the Federal Open Market Committee (FOMC) meeting, suggesting that it may yield a favorable surprise for traders and investors. Market participants have largely factored in the likelihood of a pause in rate hikes during the September 20 meeting.
A Potential Pivot by the US Fed
In a conversation with CNBC leading up to the Fed’s announcement, Lee proposed that the central bank might offer a sense of relief to market participants, potentially diverging from its long-standing approach of making rate hike decisions based on incoming financial data. US Federal Reserve Chair Jerome Powell and other members of the Fed have consistently emphasized their reliance on economic data to guide their rate hike decisions. Lee commented,
“There could be an important pivot tomorrow (September 20). I think there is going to be quite a lot of relief when we see the Fed shift away from what has been a data-dependent view for a long time.”
However, Lee expressed some uncertainty about how the markets would react to the forthcoming statement from the Fed. The live FOMC press conference, hosted by the US Fed Chair, is scheduled for 2:30 p.m. Eastern Time.
Lee’s Earlier Bitcoin Prediction
Notably, earlier this year, Thomas Lee made headlines with his prediction about Bitcoin’s price, linking it to the approval of a spot Exchange-Traded Fund (ETF) by the U.S. Securities and Exchange Commission (SEC). In line with this, Bloomberg analysts have recently assessed that Bitcoin ETFs have a 75% chance of gaining approval in 2023.
Key Points to Watch in Powell’s Speech
Traders and investors will be closely monitoring Federal Reserve Chair Jerome Powell’s statement, particularly with regard to achieving the 2% inflation target in conjunction with employment considerations. Lee’s prediction suggests that Powell may provide indications of a rate hike pause in light of expectations for sustained low inflation. However, it’s worth noting that Powell had cautioned during his Jackson Hole speech that the central bank is prepared to raise interest rates further if necessary.
