Fed Holds Rates Steady Amid Economic Uncertainty, Eyes Turn to Powell’s Upcoming Speech
The U.S. Federal Reserve opted to maintain its current interest rate range of 4.25%-4.50% on Wednesday, signaling its third consecutive meeting of keeping monetary policy unchanged. This decision comes amid growing economic uncertainty, with inflation still above target and ongoing concerns over the effects of global trade disruptions.
In its statement, the Fed emphasized that “uncertainty about the economic outlook has increased,” noting that both inflation and unemployment risks have risen, which could complicate its dual mandate of price stability and full employment. The Fed’s caution underscores its concern about how external factors—like international tariffs—might influence the broader economy.
Bitcoin (BTC), which had recently surged to above $97,000 on the back of positive trade talks between the U.S. and China, retreated slightly after the Fed’s announcement, trading at $96,600. Despite the pullback, BTC remains well above the levels seen earlier in the year.
Market expectations suggest that the Fed could begin cutting rates as early as July, with analysts forecasting three rate cuts in total for the year. However, the central bank has indicated that it will wait for further clarity on the economic impact of the Trump administration’s tariffs before making any decisions.
Now, all attention is focused on the remarks from Fed Chair Jerome Powell, scheduled for 2:30 p.m. ET. Investors will be listening closely for any additional hints about the central bank’s strategy moving forward, as economic conditions remain challenging and inflationary pressures continue to build.
