As expected, the U.S. Federal Reserve has kept its benchmark fed funds range rate steady at 4.25%-4.50%, the first pause since the central bank began easing policy last September.
The accompanying policy statement noted that the unemployment rate had stabilized at a “low level” and inflation remained “somewhat elevated.” The wording was hawkish as it removed reference to “progress” on inflation moving to its 2% target.
Under pressure for most of this week, the price of bitcoin (BTC) dipped to $101,800 shortly following the news.
Since the Fed’s first September rate cut, the fed funds rate has been slashed by 100 basis points. The U.S. 10-year Treasury yield, however, has gone in the opposite direction, rising to 4.6% fro 3.6% — a divergence between short-term and long-term rates that rarely has been seen.
That divergence as well as a series of stronger than expected reports on the economy and inflation has not been lost on the Fed….
