Bitcoin News Today: Fed Holds Rates, No September Cut as Markets Sell Off Sharp

The U.S. stock and cryptocurrency markets reacted sharply on Wednesday to the Federal Reserve’s decision to hold interest rates unchanged in July and to the subsequent remarks by Fed Chair Jerome Powell, who indicated no imminent rate cuts for the September meeting. The comments, delivered during a post-policy press conference, ended weeks of speculation about potential easing and immediately triggered a broad sell-off across major equity benchmarks and crypto assets [1]. The S&P 500 closed down 0.12% at 6,362.90, while the Dow Jones Industrial Average fell 0.38% to 44,461.28. The Nasdaq Composite was the lone major index to finish in positive territory, gaining 0.15% [2].

Powell emphasized that the Fed remains focused on managing inflation expectations and cautioned that President Donald Trump’s new tariffs are beginning to influence prices, though their broader economic impact remains unclear. “Our obligation is to keep longer-term inflation expectations well anchored and to prevent a one-time increase in the price level from becoming an ongoing inflation problem,” he stated [1]. His remarks effectively dashed hopes for a September rate cut and pushed Treasury yields higher as investors recalibrated for a prolonged period of elevated rates.

The crypto market also suffered a notable hit in the wake of Powell’s comments. Bitcoin dropped slightly to $117,777, a 0.1% decline, while Ethereum managed a 0.4% gain. Over 75% of the top 100 cryptocurrencies recorded losses of more than 1% overnight, underscoring the sector’s heightened sensitivity to U.S. monetary policy [3]. The Coinbase Premium Index, a key indicator of institutional demand for Bitcoin in the U.S., turned negative for the first time since May 29, breaking a 62-day positive streak [1]. The index had previously held a record 94-day positive run, reflecting strong domestic buying interest before the market reassessment.

The Fed’s decision was not unanimous. Two members of the board—Michelle Bowman and Christopher Waller—dissented, supporting a 0.25 percentage point rate cut at the July meeting. Their stance highlights ongoing internal disagreements about the appropriate pace of monetary policy adjustment amid trade-related inflationary pressures [2]. Traders had been expecting at least one rate cut before year-end, but Powell’s comments introduced significant uncertainty, reinforcing a wait-and-see approach as tariffs continue to distort price signals [1].

Political dynamics also played a role in the decision. President Trump has publicly pushed for lower rates, but Powell’s firm stance signaled the Fed’s resistance to short-term political pressures. “Powell isn’t buckling under the political pressure to cut rates, so markets needed to reprice the overall level of the Fed Funds rate going out a few months,” said Jamie Cox, managing partner at Harris Financial Group [2]. UBS strategists added that any perceived capitulation could erode the Fed’s credibility, particularly given the ongoing inflationary effects of Trump’s tariffs [4].

The ripple effects of the decision extended beyond U.S. markets. Emerging market assets saw further losses as investors priced in a reduced likelihood of aggressive rate cuts in the near term and weighed the implications of U.S. trade policies on global inflation and growth [5]. Meanwhile, the U.S. economy continued to show resilience, with second-quarter GDP growth coming in at 3%, surpassing the 2.3% forecast [2].

In equities, sector-specific movements emerged. Consumer-facing stocks, such as Home Depot, faced sharper declines as expectations for rate-driven demand waned [1]. Regional banks, including PNC Financial Services Group, received a boost after Oppenheimer upgraded its shares to “outperform,” citing stronger fundamentals [6]. Fintech stocks like PayPal and Spotify were under scrutiny following mixed earnings, with analysts divided on whether the pullbacks offered entry points [7].

Overall, the Fed’s decision reinforced a climate of caution in financial markets. While the central bank’s focus on price stability provided some reassurance, it also tempered hopes for near-term relief in borrowing costs. With earnings reports and geopolitical developments introducing further uncertainty, investors remain closely watching both economic data and central bank messaging for the next directional cues.

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[1]title: S&P 500 closes lower, Dow drops more than 150 points as ... (https://www.investopedia.com/dow-jones-today-07302025-11781577)

[3]title: Bitcoin News Today: Federal Reserve Holds Rates Steady ... (https://www.ainvest.com/news/bitcoin-news-today-federal-reserve-holds-rates-steady-crypto-market-drops-4-8-uncertainty-2507/)

[4]title: Jobs report could trump Fed decision, says UBS (https://www.bloomberg.com/news/articles/2025-07-30/emerging-markets-trade-flat-as-fed-tariff-uncertainties-weigh)