Fed holds key rate, Bitcoin loses value

On May 7, the United States Federal Reserve (Fed) decided to keep the key interest rate unchanged at 4.25–4.5%. This decision aligned with market expectations and the consensus forecast of analysts.

Economic Activity Remains Stable

According to the Fed's press release, economic activity in the United States continues to demonstrate steady growth despite fluctuations in net exports:

«Although net export fluctuations affected the data, recent indicators suggest that economic activity continues to grow at a steady pace. In recent months, the unemployment rate has stabilized at a low level, and labor market conditions remain stable. Inflation remains somewhat elevated.»

Fed Chair Jerome Powell stated during the press conference that the increase in tariffs in the United States turned out to be «significantly larger than expected,» but the impact of this decision on the economy remains uncertain.

Bitcoin Reacts with a Decline

Following the Fed's announcement, the price of Bitcoin dropped from $97,000 to $96,350. At the time of writing, the leading cryptocurrency is trading at approximately $96,240.

Other assets from the top 10 by market capitalization also showed similar dynamics. The total market capitalization of the crypto market at the time of writing stands at $3.07 trillion, which is 0.45% lower than the previous day.

Analysts' Volatility Forecasts

According to Volmex implied volatility indexes, fluctuations in major cryptocurrency prices are expected to remain moderate. Experts from K33 noted that the FOMC is aiming to trigger significant volatility this week:

«Since the last FOMC meeting, [Donald] Trump has been pressuring Jerome Powell to urgently cut rates.»

Currently, the Fed remains committed to its goals of supporting maximum employment, achieving inflation at the 2% level, and maintaining long-term inflation expectations at appropriate levels.