Crypto closed out July on the back foot, sitting out Friday's stock rally as the Federal Reserve's hawkish stance and stubbornly high inflation pushed the rate cut that bulls were counting on further out of reach.
Bitcoin fell 3.5% over 24 hours to $62,464, CoinGecko data shows, while the S&P 500 climbed 1.7% to 7,437 and the Nasdaq gained 2.8%. Ether dropped 3.1% to $1,863, and total crypto market capitalization slipped 2.3% to $2.24 trillion. Bitcoin still gained 4.3% in July, bouncing from under $58,000 early in the month, and the broader CoinDesk 20 index posted its first positive month in three, but the market is limping into August.
The Federal Reserve held rates at 3.50%–3.75% on Wednesday, its fifth consecutive hold, on a 9–3 vote in which all three dissenters — Beth Hammack, Neel Kashkari and Lorie Logan — preferred a hike, the first trio of same-direction dissents since 2016.
Chair Kevin Warsh, in his second meeting leading the committee, was blunt: "There is no soft inflation target, there is no soft implicit target — not on this Committee's watch," he said, adding that "this Fed will not waver."
The data backed him up a day later. June PCE inflation came in at 3.7% year-over-year, down from 4.1% on falling energy prices, with core at 3.3%, but far above the 2% target.
