Goldman Sachs Downgrades September Rate Hike Odds, What Does It Mean for Bitcoin?

The Federal Reserve's upcoming monetary policy meeting in September has sparked interest among Bitcoin investors. Goldman Sachs' Chief Economist, Jan Hatzius, believes a rate hike is 'very unlikely' due to weak retail sales, jobs, and inflation data.

This assessment is supported by the CME FedWatch tool, which shows the odds of a September hike fell to 30.6% from 52.2% last week, with a hold at 3.50%-3.75% now priced at 69.4%. The market's expectations for a rate hike have been significantly reduced.

The relationship between interest rates and Bitcoin is complex. In 2019, during the Fed's rate-hike pause, Bitcoin returned roughly 170%. However, every rate hold in 2026 has been followed by declines. This anomaly makes it difficult to predict how Bitcoin will react to the upcoming policy decision.