Fed Holds Rates but Signals Inflation Worry, Putting Bitcoin Under Pressure

The US central bank voted 10-2 on Wednesday to leave its benchmark rate at 3.75% to 4%. Governor Lisa Cook and Cleveland Fed President Beth Hammack wanted a quarter-point increase instead. Fed Chair Kevin Warsh said inflation has stayed above the 2% goal for close to six years and that bringing it down is the Fed’s responsibility. He would not say what the committee might do at its next meeting.

December Rate Hike Odds for Bitcoin Traders

CME FedWatch data showed a 78.4% chance of a quarter-point hike by December and a 67.3% chance of at least one by March. The Fed meets Dec. 8-9. Iggy Ioppe, chief investment officer at Theo, said markets had priced in the hold but not the hawkish tone, and that Bitcoin now has to compete with a risk-free rate near 4%.

What Could Move Bitcoin Next

Treasury yields, the US dollar and overall risk sentiment may matter more than the Fed decision itself. Attention now turns to Thursday’s PCE inflation report and big tech earnings.