Federal Reserve Maintains Interest Rates, Awaits Economic Data

Jerome Powell, Chair of the Federal Reserve, announced on May 29, 2025, that the central bank will maintain current interest rates, emphasizing decisions will rely on incoming economic data.

The Federal Reserve’s decision to pause interest rate changes highlights its wait-and-see approach, influencing financial markets and cryptocurrency sectors.

Federal Reserve Chair Jerome Powell declared U.S. monetary policy would remain unchanged, with a target federal funds rate of 4.25–4.5%, subject to economic conditions. His policy alignment aims to support employment and price stability, indicating reliance on incoming data.

Interest rate stability generally supports market equilibrium. Cryptocurrency markets, including Bitcoin and Ethereum, react significantly to such signals due to macroeconomic interdependencies. This decision keeps liquidity conditions consistent.

Economic stakeholders anticipate this approach may reduce volatility across financial assets, aligning with the Fed’s dual mandate of maximum employment and price stability. However, crypto assets historically show volatility linked to Federal Reserve announcements.

Chair Powell did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook. Finally, Chair Powell said that he and his colleagues on the FOMC will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis.

Long-term, potential outcomes include shifts in financial risk dynamics and market expectations. Historically, Fed rate pauses have led to increased risk appetite, affecting both traditional and crypto markets. Observers anticipate future decisions as pivotal for economic direction.