Federal Reserve Pauses Rate Cuts, Bitcoin Remains Above $102,000
The Federal Reserve has paused interest rate cuts, maintaining the federal funds rate at 4.25% to 4.5%. This decision follows three consecutive reductions and reflects steady economic growth, a strong labor market, and ongoing inflation pressures.
Key Points
- The Fed adopts a “wait-and-see” approach, indicating potential future adjustments.
- The crypto market reacted mildly; Bitcoin price remained above $102,000, while Ethereum and Solana saw slight declines.
- Inflation has exceeded the 2% target for 45 months, prompting the Fed's cautious stance.
- Higher rates increase borrowing costs for loans and mortgages.
- The Fed does not anticipate significant rate cuts, with only minor reductions expected in 2025.
- Tariffs and trade policies may influence future rate decisions, as noted by Jerome Powell.
Crypto Services Development
Jerome Powell has shifted his position on cryptocurrencies, suggesting banks may offer crypto services to customers. This change may signify the decline of Operation Chokepoint 2.0, which restricted the crypto industry. Pro-crypto appointments in the government could lead to further regulatory shifts.