Federal Reserve Chairman 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 comes amid heightened scrutiny and political tension, which Powell cited as the reasons for his change of heart during a press conference following the Fed's decision to maintain interest rates at 3.5%-3.75%. Powell expressed concerns that legal actions against the central bank are undermining its ability to implement monetary policy independently of political influences.
"These attacks are eroding the institution and jeopardizing its capacity to conduct monetary policy without political interference," Powell stated. The decision to keep interest rates steady was widely anticipated, but the dissent from three Governors was notable, according to macro analyst Matt Mena.
The Fed's choice to hold rates steady, combined with the dissenting voices calling for a more hawkish stance, has had a cooling effect on risk assets, including bitcoin, which slipped below the $75,000 support level. Market attention is now focused on potential future policy shifts, with Mena suggesting that the markets may start to factor in the possibility of rate cuts and the impending passage of the CLARITY Act. If market momentum returns, Mena believes that the path to $85,000-$90,000 for bitcoin becomes more feasible.