Federal Reserve Chair Jerome Powell has announced his decision to remain on the central bank's board as Governor beyond his current term, which is set to expire in May. This revelation came during a press conference following the Fed's decision to maintain interest rates at 3.5%-3.75%. Powell cited the ongoing legal pressures and political tensions as the primary reasons for his decision to stay on, despite his initial intention to adopt a lower profile.
Powell expressed concerns that the legal actions against the central bank are undermining its ability to implement monetary policy without political interference. "I am worried that these attacks are compromising the institution and putting at risk the ability to conduct monetary policy without considering political factors," Powell stated. The decision to keep interest rates unchanged was widely anticipated, but the dissent from three Governors was notable, according to macro analyst Matt Mena.
The hawkish tone had a negative impact on risk assets, with bitcoin prices 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 markets may start to factor in a pivot by Kevin Warsh that favors rate cuts, and more importantly, the imminent 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."