The FOMC is expected to firm up at least two elements of the Federal Reserve’s plans for the year, though both have been broadly telegraphed. There may be more details about the schedule for “tapering” the Fed’s bond-buying program, which more than doubled its balance sheet during the coronavirus pandemic to nearly $9 trillion. The tapering and divestment schedule has significant implications for inflation and capital markets.

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But the real headline issue is the potential for change in the Fed’s interbank interest rate. There is very little chance of a hike actually coming out of the current meeting – the Fed has said it needs to begin the asset taper before hiking rates, apparently for technical reasons. But we already have a solid sense of the direction things are going.

The Fed has previously said it plans three rate hikes this year, in response to rising inflation and an incredibly tight job market. Goldman Sachs, apparently seeing even more pressure ahead, predicts four hikes, with rates rising to 2.5% to 2.75% by 2024. The FMOC could provide more clarity on that schedule today.

If the Fed stays the course, it could amount to a dramatic change to the macroeconomic environment. More to the point, it might be perceived as a major change by investors and employers, who would shift their own choices accordingly. Among other impacts, higher Fed interest rates usually draw capital away from speculative sectors because savers and investors are drawn to safer returns in government bonds. At the margins, this will inevitably pull value out of both tokens and crypto startups (along with tech and venture capital more generally).