The US Federal Reserve kept interest rates unchanged, following its first rate hike in over three years in September. The decision was not unanimous: two of the 12 policymakers voted to raise the benchmark rate to 4%-4.25%.
Fed Holds Rates Steady
After last month's hike, the first since mid-2023, attention turned to September inflation data. Both the CPI and PPI showed inflation remained a major concern. However, expectations for another rate hike dropped, and experts expected any increase to come in December.
The Fed justified its decision by highlighting stronger-than-expected economic activity, adding: "Job gains have kept pace with the workforce, and the unemployment rate has changed little."
In a subsequent press conference, Fed Chair Kevin Warsh cautioned that financial uncertainty and elevated inflation remain due to "geopolitical developments." He emphasized that the US economy is "resilient" and that the committee will "deliver price stability."
"Americans, of course, are still dealing [with] inflation that has been running above the committee's objective for close to six years," Warsh said. "It's our responsibility to get inflation down."
Asked why the Fed did not raise rates today if it might hike in December, Warsh said quashing inflation is not about a specific date or data point but about broader objectives and a monetary policy strategy. He declined to respond to Trump's comments that rates should be lowered, but said "politics played no role" in the decision to hold rates steady.
BTC Stays Stable
Although some on-chain signals suggested BTC's price could tumble after the Fed's decision, that has not been the case so far. The cryptocurrency had a volatile day, jumping from $79,500 to $81,700 ahead of the meeting before dipping to $80,500 just hours before its conclusion.
It rebounded swiftly above $81,000 after Chairman Warsh finished his press conference. Other major macro developments through the end of the week could drive further price fluctuations.
