Federal Reserve Chair Jerome Powell has announced that he will continue to serve on the central bank's board as a Governor after his term concludes in May. This decision was revealed during a press conference following the Fed's decision to maintain interest rates at 3.5%-3.75%. Powell expressed concerns about the potential consequences of legal actions against the central bank, stating that these challenges are compelling him to remain in his position, despite his intention to maintain a low profile.
'I am concerned that these attacks are undermining the institution and jeopardizing its ability to implement monetary policy without political influence,' Powell stated. The decision to keep interest rates unchanged was widely anticipated, but the dissenting votes from three Governors were notable, according to macro analyst Matt Mena.
'The surprise was not the Fed's decision to hold rates steady, but rather the three dissenters who advocated for a more aggressive approach, which poured cold water on the market's expectations of a pivot,' Mena commented. The hawkish tone had a negative impact on risk assets, with bitcoin slipping below the $75,000 support level as traders prepare for a potential retest of the $73,000 level.
Attention is now focused on potential policy changes in the future. 'The market may start to factor in the possibility of a pivot led by Kevin Warsh that favors rate cuts, as well as the impending passage of the CLARITY Act,' Mena said, adding that if momentum returns, 'the path to $85,000-$90,000 appears to be a viable option.'