The Fed left the rate unchanged, but the minutes of the April meeting turned out to be an unpleasant signal for the markets. Within the regulator, the group of officials who believe that the fight against inflation is not over yet and that new rate hikes cannot be ruled out has grown stronger.
For bitcoin, this creates a complicated backdrop. The crypto market is once again watching not only BTC charts, but also bond yields, the dollar, and liquidity expectations. The tougher the Fed’s tone, the more cautious investors become toward risky assets.
Fed Division Deepens
The April 28–29 meeting showed a rare level of disagreement. The rate remained in the 3.50–3.75% range, but four participants immediately disagreed with the final wording of the decision. This was the highest number of dissenting votes since 1992.
Steven Miran advocated for a 25 basis point rate cut, believing that overly tight policy could hurt the labor market. Meanwhile, Beth Hammack, Neel Kashkari, and Lorie Logan, on the contrary, did not want to leave a hint of possible easing in the statement. As a result, the minutes showed not readiness to cut, but a debate about how tight Fed policy should remain.
Inflation Shifts Balance Back Toward Hawkish Rhetoric
The main reason for the tension is accelerating inflation. According to Fed staff estimates, the PCE index rose to 3.5% in March after 2.8% in February. Such a jump sharply complicated the arguments for a quick rate cut.
Officials specifically pointed to rising energy prices, tariffs, logistics costs, and geopolitical risks in the Middle East. Additional factors were prices in the tech sector and more expensive fertilizers. For the Fed, this means that inflationary pressure is coming from several sources at once, not just a single temporary shock.
Market Recalculates Rate Scenarios
Before the minutes were published, investors still hoped the Fed would gradually move toward easing policy. Now that confidence is weaker. If inflation remains high, the regulator may not only postpone a rate cut but also return to discussing a hike.
Such a scenario supports the dollar and US government bond yields. For stocks and cryptocurrencies, this is a less comfortable environment because expensive money reduces demand for speculative assets. Tech stocks and bitcoin remain especially sensitive, as in recent years bitcoin has increasingly behaved like an asset highly dependent on macroeconomics.
Bitcoin Faces Another Test Zone
After the minutes, traders began to watch BTC’s key levels more closely. The $76,000–74,800 zone remains in focus. Losing it could trigger more profit-taking after the recent market recovery.
Above, the $82,000 area remains an important barrier. If the market reacts more calmly to the next inflation data, bitcoin may try to return to this area again. But for now, the Fed’s hawkish rhetoric makes this scenario less straightforward.
Oil and the Middle East Become Separate Risks
The Fed specifically noted the influence of the energy market. The conflict in the Middle East has already increased uncertainty around supply, logistics, and oil prices. This is directly related to inflation because expensive energy quickly flows into transportation, production, and consumer prices.
For the crypto market, this is a double risk. On one hand, rising oil boosts inflation expectations. On the other, it reduces the likelihood of a quick Fed pivot to easier policy. In this situation, investors usually reduce their share of highly volatile assets.
Fed Chair Change Adds Uncertainty
The market is also assessing the transition from Jerome Powell to Kevin Warsh. Investors are trying to understand whether the new Fed chair will be tougher on inflation and rates. For now, expectations are rather cautious.
If Warsh maintains the policy of prolonged high rates, pressure on the crypto market may continue. Historically, bitcoin finds it easier to grow during periods of excess liquidity, not when the regulator keeps the cost of money elevated.
What’s Next?
The next important milestone will be new inflation data and the June FOMC meeting. If price pressures do not ease, the market will increasingly price in a scenario of a long period of high rates. For bitcoin, this will mean continued pressure in the key support range.
For now, the main takeaway from the minutes is simple: the Fed is not ready to declare victory over inflation. The regulator is leaving itself room for more hawkish actions, and the crypto market will once again have to trade not only on industry news but also on the entire macroeconomic backdrop.
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