Federal Reserve holds rates steady at 3.5-3.75% as Chair Warsh heads to Congress

The Federal Reserve published its semiannual Monetary Policy Report on July 14, setting the stage for Chair Kevin Warsh’s back-to-back congressional appearances on July 14 and 15. It’s Warsh’s first time delivering the report since taking office earlier this year.

The headline number: the federal funds rate target range stays parked at 3.5-3.75%, exactly where the FOMC left it after voting 12-0 at its June 16-17 meeting. No dissents, no drama. Interest on reserve balances was set at 3.65%.

What the report actually says

The Monetary Policy Report, required under the Federal Reserve Act, covers the Fed’s assessment of economic conditions, its policy implementation, and forward-looking projections.

The report highlights solid expansion in economic activity, strong productivity numbers, and investment figures that suggest businesses haven’t pulled back despite a messy global backdrop. Unemployment has remained stable. Tensions in the Middle East continue to weigh on the outlook. The next FOMC meeting is scheduled for July 28-29.

The crypto angle Congress won’t ask about (but should)

The Monetary Policy Report itself didn’t mention Bitcoin or any specific digital assets.

Bitcoin rallied back above $60,000 following Warsh’s recent remarks indicating that inflationary pressures were easing. With spot Bitcoin ETFs now firmly established as investment vehicles, the largest digital asset increasingly behaves like a macro asset. Traders are watching Bitcoin not just as something that reacts to monetary signals, but as a potential leading indicator of where risk appetite is headed.

The Trump administration added another layer to the story in May 2026 by initiating a review of digital asset firms’ access to Federal Reserve payment systems. If digital asset firms get broader access to Fed payment rails, it could legitimize the sector in ways that no ETF approval ever could.

What this means for investors

The rate hold at 3.5-3.75% creates a specific kind of environment for risk assets. Rates aren’t going up, which removes the biggest headwind that crushed crypto in 2022 and early 2023. But they’re not coming down either.

For Bitcoin specifically, the $60,000 level has become a psychological benchmark tied to Fed sentiment. Positive commentary from Warsh pushed prices above that threshold, suggesting that the next FOMC meeting on July 28-29 could be a volatility catalyst.

The Fed’s review of digital asset firms’ access to payment systems adds a regulatory wildcard. Depending on the outcome, it could either open new infrastructure for crypto businesses or create additional barriers. Investors positioning in crypto-adjacent equities and tokens tied to payment infrastructure should be tracking this review closely.

The 12-0 vote in June suggests the committee is unified for now. The report notes stable unemployment, strong productivity, and geopolitical risk as concurrent factors shaping the outlook.

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