Fed holds rates at 3.75%-4% as two officials dissent in favor of a hike
Author: Crypffalo Research · 01:10 29/10/2026
The Fed kept rates at 3.75%-4% in a 10-2 vote, with two officials pushing for a 25 bps hike. Markets fully price a December increase; bitcoin hovers near $81,000.
The Federal Reserve left its benchmark rate unchanged at 3.75%-4% on Wednesday, with the decision released at 2 p.m. ET (01:00 GMT+7 on Oct 29). The hold was widely expected after the central bank raised rates by 25 basis points in September.
The vote was the story. Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented, both preferring a quarter-point hike at this meeting.
Key takeaways
- Decision: Fed funds target range held at 3.75%-4%, with no new balance sheet action.
- Vote: 10-2, with both dissents leaning toward tighter policy.
- Inflation: The statement repeats that inflation "remains elevated."
- Expectations: Markets fully price a rate hike at the early-December meeting.
- Bitcoin: Trading around $81,000 after the announcement as the 10-year Treasury yield rose to 5.025%.
What the Fed said
The statement describes economic activity as expanding at a "strong pace." That is an upgrade from September, when the Fed used the phrase "solid pace."
On jobs, the Fed said payroll gains have kept pace with the workforce and the unemployment rate has changed little. It also pointed to strong productivity growth and robust capital investment.
Policymakers again stressed that inflation is elevated and pledged a timely return to the 2% goal. Uncertainty remains high, partly because of geopolitical developments.
Why the dissents matter
At the Sept. 16 meeting, the Fed raised rates by 25 bps to 3.75%-4% in a unanimous 12-0 vote. This time the consensus cracked, and it cracked in the hawkish direction.
The backdrop gives the hawks ammunition:
- CPI came in above expectations for two straight months, according to CoinDesk.
- Oil has been trading near $100 a barrel, adding to price pressures.
- The dollar index (DXY) sits close to its 2026 high of 102.16.
This was also the Fed's last meeting before the U.S. midterm elections. Chair Kevin Warsh holds his press conference at 2:30 p.m. ET, where investors will look for clues about December.
What it means for crypto markets
Bitcoin took the decision in stride, holding around $81,000 right after the release. Earlier in the session it touched $81,411 before slipping to roughly $80,600; ether traded near $2,340.
- Bull case: If Warsh signals no rush to tighten further, markets could pare December hike bets, giving risk assets including crypto some relief.
- Risk case: If the Fed confirms a December hike path, higher yields and a firmer dollar could pressure bitcoin, which briefly fell below $80,000 on Monday.
The 2-year Treasury yield climbed 4.6 bps to 4.78% after the decision. That move suggests the bond market is leaning toward more tightening ahead.
For crypto traders, the bigger question is the path rather than today's hold. A December hike is already priced in, so any hint of further tightening could weigh on sentiment, while a softer tone could trigger a relief bounce.
What to watch next
- Chair Kevin Warsh's press conference at 2:30 p.m. ET on Oct 28.
- Upcoming PCE and CPI inflation prints, which will shape the December decision.
- The Dec 8-9 FOMC meeting and the Fed's updated economic projections.
- Derivatives liquidations, tracked on our real-time liquidations page and economic calendar.
Frequently Asked Questions
Did the Fed raise rates at this meeting?
No. The Fed held the target range at 3.75%-4%, though two voting members wanted a 25 bps hike.
What do markets expect for December?
According to CoinDesk, markets fully price one rate hike at the early-December meeting.
How did bitcoin react?
The initial reaction was muted, with bitcoin near $81,000. The next move likely depends on Warsh's press conference and upcoming inflation data.
*This content is for information only and is not financial advice.*
Tags: Fed, Interest Rates, FOMC, Bitcoin
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