Fed Holds Rates Steady; Crypto Dips as Middle East Uncertainty Grows

The Federal Reserve held its benchmark interest rate steady for the third consecutive meeting on Wednesday, keeping the target range at 3.5% to 3.75%. The decision comes as conflict in the Middle East fuels economic uncertainty.

In a statement, the Fed highlighted that developments in the region are contributing to a high level of uncertainty about the outlook.

Following the announcement, Bitcoin and Ethereum dipped. Bitcoin is down 1.4% in the last 24 hours, trading around $75,100, while Ethereum fell 2.3% to about $2,240.

Earlier Wednesday, the Senate Banking Committee advanced Kevin Warsh’s nomination to succeed Fed Chair Jerome Powell, whose tenure ends next month. Warsh, who holds crypto-related investments including Solana and Polymarket, has voiced support for Bitcoin.

Despite a call from Fed Governor Stephen Miran for a 25 basis-point rate cut, the committee chose to stand pat. Lower rates typically boost risk assets like crypto, but traders do not expect loosening anytime soon.

Meanwhile, U.S. energy costs are rising. The national average gas price hit $4.22 per gallon, up 6.2% over the past month and well above the $2.99 average before the outbreak of the U.S.-Israel conflict with Iran.