Two officials wanted higher interest rates immediately, while traders see an 87% chance of a December hike that could complicate Bitcoin's recovery.
The Federal Reserve held its target range at 3.75% to 4% on Oct. 28 on a 10-2 vote. Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented, favoring an immediate quarter-point hike.
Rate-market trackers put the odds of a December hike between about 83% and 88%, and the market had priced in a hold before the meeting.
Bitcoin dipped to $80,500 and recovered above $81,000, within reach of the roughly $81,500 aggregate cost basis of US spot Bitcoin ETFs that Glassnode estimates.
The committee called growth strong and repeated its commitment to returning inflation to 2%.
At his press conference, Chair Kevin Warsh acknowledged that credit conditions had tightened, credit spreads had widened, and higher rates were affecting technology investment, including AI.
He declined to describe overall financial conditions as tight, suggesting the Fed is willing to tolerate more market strain before changing course. The 10-year Treasury yield sat near 5.04% on decision day and the two-year near 4.78%, while the University of Michigan's final October sentiment index came in at 48.
Fabian Dori, chief investment officer at Sygnum Bank, said in a note:
“A hawkish hold is what the market expected, with no change for October and a 25bps hike for December priced in.
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