Federal Reserve Holds Key Rate Steady as Bitcoin Dips

On May 7, the United States Federal Reserve maintained its key interest rate within the range of 4.25–4.5%.

“Although fluctuations in net exports affected the data, recent indicators suggest that economic activity continued to expand at a solid pace. In recent months, the unemployment rate has stabilized at a low level, and labor market conditions remain stable. Inflation remains somewhat elevated,” the press release stated.

The decision aligned with market expectations and the consensus forecast of analysts.

“The FOMC is poised to trigger significant volatility this week. Since the last FOMC, [Donald] Trump has attempted to pressure Jerome Powell to urgently cut rates,” noted K33 experts.

Following the release of the data, Bitcoin fell from the level of $97,000 reached a few hours earlier to $96,350.

At the time of writing, the leading cryptocurrency is trading around $96,240.

Most assets in the top 10 by market capitalization showed similar dynamics to Bitcoin.

At the time of writing, the total cryptocurrency market capitalization stands at $3.07 trillion, having decreased by 0.45% over the past day.

Volmex implied volatility indices suggest that fluctuations in key cryptocurrency prices will be moderate.

“We remain committed to supporting maximum employment, achieving sustained inflation at 2%, and keeping long-term inflation expectations well anchored,” said Federal Reserve Chairman Jerome Powell at a press conference.

He noted that the announced tariff increase was “significantly larger than expected,” but the impact of this decision on the economy remains uncertain.

“We don’t think we need to rush. We think we can be patient. We will monitor the data,” added the chairman, pointing to extraordinary uncertainty.

In March, annual inflation in the US stood at 2.4% (the lowest since September) compared to 2.8% the previous month.