The US Federal Reserve has decided to keep its benchmark interest rate steady at a target range of 4.25% to 4.5%.
Bitcoin is currently trading at $117,650, experiencing little volatility.
The Fed says economic growth “moderated” in the first half of the year.
At the same time, inflation remains “somewhat elevated”, meaning it’s still above the Fed’s oft-repeated 2% target.
Internal disagreement
Notably, two Fed governors (Bowman and Waller) dissented from the majority decision. They wanted to cut rates by 0.25 percentage points. The vote was 9–2. Governor Adriana Kugler did not vote.
Tone change
The Fed removed earlier language that said uncertainty about the economy had “diminished.” Now, they say “uncertainty remains elevated.”
What’s next?
Futures imply traders now see a 68% chance thatthe Fed opts to lower rates by at least 25 basis points at the September meeting. There is also a 65% chance of the Fed lowering rates by at least another 25 basis points at the December meeting.
