The Federal Reserve again held its benchmark interest rate in the 3.50%-3.75% range at the FOMC meeting on July 29, 2026. This decision marks the fifth consecutive meeting without any changes, highlighted by a 9-3 split vote in the committee room that underscores internal debates. Bitcoin responded flatly to the meeting outcome, settling in the $64,100 range with a slight 0.3% increase in the last 24 hours after the announcement.
Three committee members - Beth Hammack of Cleveland, Neel Kashkari of Minneapolis, and Lorie Logan of Dallas - voted against the majority, demanding a 25-basis-point hike. Hammack, who leads the Cleveland region, reinforced her stance by arguing that inflation has remained above the central bank’s official target for more than the last five years.
Why the Rate Hold Is Considered Appropriate
Robert Kaplan, Vice Chairman of Goldman Sachs and former President of the Dallas Fed, believes the decision to hold interest rates was absolutely correct. He argued that the Fed still has sufficient time to gather additional economic data before the next committee meeting on September 15-16.
July CPI data recorded a monthly increase of 0.1%, confirming a cooling trend with annual inflation dropping to 3.4% from 3.5% in June. The core inflation report also shrank to 2.5% from 2.6%, with a monthly increase ratio of 0.2%. Responding to these figures, Polymarket placed a 67% probability that the Fed will not change interest rates in September, leaving a 34% chance for a 25 bps hike option.
Despite supporting the Fed’s decision in July, Kaplan remains cautious of several inflation drivers. He highlighted the massive flow of investment into the artificial intelligence sector, the implementation of new tariffs, labor shortages, and skyrocketing oil prices that dragged energy costs up 14.7% compared to last year.
What Does the Market Await from Jackson Hole?
Policymakers’ calculations have become more complicated after the latest data from the labor sector was released. The July payrolls report showed a decrease of 23,000 jobs - a stark contrast to early estimates that projected an addition of 80,000 to 85,000. Furthermore, data revisions for May and June erased a combined 103,000 jobs from the government’s official records.
Since Kevin Warsh took office as Fed Chair in early 2026, the central bank has begun to reduce its reliance on forward policy guidance. This new approach forces investors to guess the direction of interest rates solely based on monthly economic data releases. Kaplan urged Warsh to use the stage of the Jackson Hole economic symposium on August 27-29 to explain the specific reasons behind the committee’s decision to hold interest rates in July.
This year’s annual symposium features the theme ‘Financial Innovation: Implications for Payments and Policy’, a topic that directly intersects with the policy framework of the crypto industry. Market participants must now weigh the economic direction between persistent inflation and a cooling labor market - two opposing forces that will determine the availability of institutional liquidity for Bitcoin until the end of the year.
Reported from crypto.news.
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
