The Fed freezes interest rates and Bitcoin holds above $70.000

The US Federal Reserve (Fed) has just confirmed its decision to keep the federal funds rate in the range of 3,5% to 3,75%. 

Following the meeting of the Federal Open Market Committee (FOMC), which took place on Wednesday, March 18, the federal agency opted for caution in the face of inflation that, according to official measurements, has not yet definitively converged towards the target set at 2%. 

In this monetary context, Bitcoin's price showed institutional resilience, holding above $70.000 despite the immediate volatility that typically accompanies such announcements. Institutional investors appear to have absorbed Jerome Powell's message, prioritizing the asset's resilience in the face of a scenario where interest rate cuts are projected to occur further in the future than initially anticipated.

Powell maintains a firm tone: the Fed sees no room to lower rates yet

During the press conference following the announcement, Federal Reserve Chairman Jerome Powell explained that the U.S. economy continues to expand at a solid pace, although he acknowledged that progress in reducing inflation has stalled somewhat due to external factors. 

According to Powell's statements, between 50% and 75% of current core inflation is attributable to the impact of tariffs and logistics costs, which It hinders immediate flexibility. of economic policy.

The core Personal Consumption Expenditures (PCE) index stands at 3,0%, a figure the Fed considers high to begin an easing cycle. According to the FOMC's summary of economic projections, most committee members agree that it would not be appropriate to cut interest rates until there is greater confidence that price increases are heading sustainably toward the target range. 

The official also stressed that the labor market, with an unemployment rate of 4,4%, does not currently represent a source of inflationary pressure, giving the agency room to maneuver to keep rates at restrictive levels for a longer period if necessary.

Bitcoin withstands Fed pressure and holds above $70.000

Despite the fact that the high interest rate environment usually puts pressure on equity and alternative market assets, Bitcoin has shown relevant technical consolidation at the close of trading. 

According to market data recorded after the Fed's speech, the cryptocurrency experienced a fluctuation of approximately 5%, but managed to rebound from intraday lows to climb back above the $70.000 mark. This stability is interpreted by various financial analysts as a sign of market maturity, which had already priced in a 99% probability of rates remaining unchanged, according to the CME FedWatch indicator.

Bitcoin's price reaction was also influenced by the Fed's updated inflation forecast for 2026, which it raised to 2,7% from the previous 2,4%. 

In the past, periods of inflationary uncertainty have generated sustained interest in assets with scheduled shortagesBitcoin fits perfectly into this category. However, Powell's speech regarding oil prices and tensions in the Middle East introduced a note of caution that prevented an aggressive upward move. 

Bitcoin's price thus remains in an accumulation phase, where market participants assess the balance between available liquidity and the cost of global borrowing as factors that will continue to determine the price direction in the coming weeks.

Bitcoin ETFs bolster institutional confidence amid Fed pause

Bitcoin's holding above the $70.000 level this week has also been influenced by the steady flow of capital entering through Bitcoin exchange-traded funds (ETFs). 

According to the data consulted, these financial instruments have recorded positive net inflows during the last 7 business days. This behavior suggests that, regardless of the pause in Federal Reserve policy, institutional portfolios' interest in Bitcoin remains active under a long-term view.

Analysts and experts in the crypto and financial industries agree that these regulated vehicles are making a difference in how money moves within the market. Bitcoin spot ETFs allow investments to remain stable and prevent corrections from turning into episodes of mass selling, as occurred during previous periods of heightened monetary tension. Thus, while gold retreated by around 3% and fell to $4.850 per ounce following Jerome Powell's remarks, Bitcoin showed a much faster recovery, driven by the activity of exchange-traded funds. 

According to industry records, the inflows recorded this week offset much of the retail selling pressure, solidifying the perception of Bitcoin as an increasingly present component in institutional diversification strategies against fiat currency.