Key facts
- The Federal Reserve held its benchmark interest rate steady at 3.5%–3.75%.
- Bitcoin and Ethereum prices saw slight declines following the decision.
- The Fed's next set of rate projections, the dot plot, is scheduled for September.
- Inflation remains above the Fed's 2% target, partly due to rising energy prices.
- Three Federal Reserve bank presidents dissented, voting for an immediate rate hike.
The Federal Reserve maintained its benchmark interest rate at 3.5%–3.75% on Wednesday, a decision that met broad market expectations. Following the announcement, both Bitcoin and Ethereum experienced slight price dips, with Bitcoin falling around 1% to $63,890 and Ethereum trading just above $1,900. This marks the fifth consecutive meeting where the Fed has held rates steady since December 2025.
Wednesday's decision was made without updated economic projections, meaning the next 'dot plot'—which forecasts policymakers' expected rate path—will not be released until September. The committee acknowledged that the economy is expanding at a solid pace, but inflation remains above its 2% target, exacerbated by rising energy prices due to Middle East tensions. This inflation concern is significant, as nearly half of FOMC members signaled support for a rate hike before year-end in June.
Three regional Fed presidents—Beth Hammack, Neel Kashkari, and Lorie Logan—voted against holding rates steady, advocating for an immediate 25-basis-point increase. This hawkish dissent, coupled with rising oil prices nearing $100 a barrel, suggests that a September rate hike remains a possibility. Historically, lower interest rates have benefited risk assets like cryptocurrencies, while higher rates or the threat of hikes tend to pressure prices downward.