Fed holds rates at 3.75% to 4% as bitcoin briefly rises to about $81,700

The Federal Reserve maintained the federal funds target range at 3.75% to 4% on Wednesday. The vote was 10-2. Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented in favor of a quarter-point increase. A Fed governor and a regional bank president had not dissented together on the same side since 1992.

Fed Chair Kevin Warsh told reporters after the vote that politics did not influence the decision, which came days before the midterm elections. Warsh has said forward guidance is inappropriate outside a crisis, leaving investors to interpret economic data independently. The committee removed wording about when an increase might help bring inflation back to 2%. The replacement wording says additional information will determine the policy stance. The Fed upgraded the description of economic growth from solid to strong.

The policy signals suggest a move toward tighter monetary conditions. Fed funds futures and the Fed's dot plot favor an increase by December. Some market pricing indicates odds near three in four. Inflation remains elevated, and both dissenters favor action to address inflation. Warsh and other Fed officials have said additional data will determine when officials act.

Bitcoin's response was limited, with most traders having anticipated unchanged rates. Bitcoin climbed to about $81,700 within minutes of the announcement. Bitcoin subsequently dropped below $80,500 before recovering toward $81,000. Bitcoin often makes a limited initial move after Fed announcements, with a clearer direction developing over the next day. Bitcoin stood at $81,478 at the time of writing.

Spot Bitcoin ETFs received net inflows of $110 million on October 26. Spot Bitcoin ETFs received another $176 million on October 27. The inflows suggest some institutional investors are purchasing bitcoin after price declines. However, other observers have highlighted sales by large holders during price gains. Bitcoin remains about a third below the record near $126,000 reached in October 2025. Prospective rate increases are unfavorable for an asset that has benefited from inexpensive financing. The market has spent months adjusting to the possibility that easy monetary conditions have ended.

Some traders view the unchanged rate as evidence that the Fed will proceed slowly. However, other traders consider December the decisive test. Bitcoin has maintained support at $80,000 during recent sessions. A decisive fall below $80,000 would leave bitcoin exposed to the next support level.

The next major political test for bitcoin comes on November 3, when voters nationwide go to the polls. Cryptocurrency has not been a dominant campaign issue. The crypto industry spent about $176 million across more than 100 midterm races to build a bipartisan congressional bloc that could defend industry interests after President Donald Trump left office. Fairshake, the industry's largest super PAC, led the spending effort and set strategy, repeating Fairshake's role in the 2024 election cycle.