JPMorgan revises 2026 Fed rate cut outlook, Bitcoin drops to $90K as market adjusts to delayed rate cuts and tighter monetary policy.
JPMorgan Chase recently revised its outlook for the Federal Reserve, no longer expecting any rate cuts in 2026.
This shift comes as the bank reassesses the economic landscape after disappointing U.S. jobs data. As a result, Bitcoin’s price has fallen, dropping to around $90,000.
The new outlook raises questions about how this policy change could impact Bitcoin and other cryptocurrencies moving forward.
JPMorgan Revises Fed Rate Cut Expectations for 2026
JPMorgan initially anticipated a 25 basis point rate cut in 2026, but it has now revised its view.
The bank predicts the Fed will hold rates steady throughout the year, citing slower-than-expected improvement in the U.S. labor market.
The most recent jobs data, including unemployment rates and payroll reports, showed weaker-than-forecasted growth.
As a result, the bank no longer expects the Fed to lower rates in the near future.
Following recent jobs data, JP Morgan has revised its outlook and no longer anticipates any US Federal Reserve rate cuts in 2026, compared with its earlier prediction of a 25 basis point reduction in January.
— First Squawk (@FirstSquawk) January 12, 2026
This change signals that the Fed may keep monetary policy tighter for a longer period.
JPMorgan analysts explained that a weakening labor market or a drop in inflation could still lead to rate cuts later in 2026.
However, for now, the bank expects the Fed to maintain its current stance. This shift has led to some market uncertainty, with Bitcoin’s price feeling the effects.
Other Banks Follow JPMorgan’s Lead on Rate Cut Delays
JPMorgan’s revised outlook is not unique. Other major banks, including Goldman Sachs, Barclays, and Morgan Stanley, have also pushed back their expectations for Fed rate cuts.
Goldman Sachs now forecasts two rate cuts in mid-2026, as opposed to their earlier expectations of cuts earlier in the year.
Similarly, Barclays and Morgan Stanley have delayed their projections due to stronger-than-expected labor market data.
The broader market sentiment is now shifting. With the U.S. labor market remaining resilient, there is less urgency to lower interest rates.
Banks are now rethinking their monetary policy outlook, which is affecting both traditional markets and cryptocurrencies.
Traders are beginning to adjust their expectations for interest rate decisions in the coming months.
Related Reading: JPMorgan Flags Compliance Risks, Halts Banking Services for Stablecoin Firms
Bitcoin’s Price Struggles as Market Reacts to Fed Outlook
Bitcoin’s price has struggled in the wake of JPMorgan’s new forecast. The cryptocurrency dropped to around $90,000 after the news, and trading volume surged by 150%.
Bitcoin had been climbing earlier, but the news about rate cuts delayed until mid-2026 caused a sharp pullback. The adjustment in monetary policy expectations has put pressure on Bitcoin as a risk asset.
Bitcoin’s role as a hedge against inflation is being questioned. With the Fed signaling that it will not cut rates soon, investor interest in Bitcoin may diminish.
Bitcoin typically thrives in environments where inflation is a concern, but with tighter monetary policy, demand could soften.
Additionally, if upcoming data like the Consumer Price Index (CPI) report shows higher inflation, Bitcoin may face further pressure.