In its statement, the Fed confirmed the rate cut to 4.25%, a step widely priced in by traders. Market surveys showed that 94% of participants expected the decision, while a small minority predicted even more aggressive easing.
Crypto’s reaction was cautious. Bitcoin slipped 0.8% to $115,350, Ethereum (ETH) edged down 0.4% to $4,450, and XRP fell 0.8% to $3.00.
Fed Chair Jerome Powell pointed to rising unemployment as a key driver behind the decision. Weekly jobless claims recently climbed to 264,000, the highest level in four years. At the same time, inflation remains elevated at 2.9% year-over-year, keeping the Fed’s dual mandate of price stability and maximum employment in sharp focus.
Analysts suggest this could mark the formal end of the Fed’s tightening cycle, with more rate cuts expected in October and December. President Donald Trump has repeatedly criticized Powell, calling him “Jerome Too Late Powell” for what he sees as delayed action.
The U.S. government faces record debt of $37 trillion, with projected interest expenses of $1.16 trillion this year alone. Still, the Fed’s rate remains well above the ECB’s benchmark, which stands at 2.0%. For crypto, however, it is Washington’s policy direction that matters most.
At 8:30 p.m. CET, Powell will hold a press conference to explain the Fed’s decision in more detail, broadcast live on the central bank’s official YouTube channel.