The Federal Reserve raised its benchmark interest rate by 25 basis points, establishing a new target range of 3.75% to 4%. This decision marks the first rate hike since 2023 and was supported by all 12 members of the Federal Open Market Committee.
Market participants had largely anticipated this move, with the CME FedWatch tool indicating a 93% probability of a hike prior to the announcement. The Committee cited solid economic growth and stable job gains, though it noted that inflation remains elevated above the 2% target.
Following the announcement, Bitcoin experienced brief volatility, spiking to $76,000 before settling around $75,100. The broader cryptocurrency market declined by approximately 2.18% on the day, while the Crypto Fear & Greed Index dropped to 51 points.
The decision follows recent economic data, including an annual Producer Price Index increase of 5.4% in August and a monthly Consumer Price Index rise of 0.4%. Major financial institutions, including JPMorgan and Citigroup, had previously forecast total tightening of 50 basis points by year-end.
The Federal Reserve's next meetings are scheduled for October 27–28 and December 8–9. These upcoming sessions will clarify whether the current hike represents the final adjustment for the year or the beginning of a series of increases.
