The Federal Reserve left its benchmark interest rate unchanged at its latest meeting, keeping the target range at 3.75% to 4.00%. The decision was widely expected and comes ahead of next week's midterm elections, with investors now looking to December for the Fed's next move.
Two Dissents for a Hike
The vote was 10-2. Fed Governor Lisa Cook and Cleveland Fed President Beth Hammack both voted for another quarter-point increase. For Hammack, it is the second time she has dissented for the same reason, having done so in July. Cook's vote stands out because President Trump is currently trying to remove her from the Fed.
The Fed described growth as "strong," an upgrade from "solid" in September. Inflation was still called elevated, and the door could be more open for hikes if needed. The committee also stated, "The Committee will deliver price stability."
What Matters for Crypto
For crypto markets, the tone of Fed Chair Kevin Warsh's press conference is key. When borrowing stays expensive, cash and short-term Treasuries become more attractive relative to volatile assets like Bitcoin. Traders also tend to become less keen on leverage.
The decision itself was widely anticipated, leaving investors focused on Warsh's comments about December. A signal that rates could remain unchanged for longer might ease pressure on Bitcoin and other cryptocurrencies. But if Warsh suggests another increase is likely, higher bond yields and a stronger dollar could weigh on riskier assets.
Neither outcome guarantees a particular move in crypto. Traders will also be watching inflation data and the broader economic outlook.
Markets already expect more hikes starting in December and running into 2027. And even then, a nicer tone isn't automatically good news. If it's because the economy looks weak, investors may still stay away from risk.
Final Summary
- The Fed held rates at 3.75%-4.00% in a 10-2 vote.
- Crypto's next move will depend on Fed Chair Kevin Warsh's tone.
