Fed Officials Put Rate Hikes Back in Play as Inflation Stays Sticky

The Federal Reserve left interest rates unchanged on June 17, but new projections signaled that additional tightening is again being seriously considered. The Federal Open Market Committee voted unanimously to keep the federal funds rate in a 3.5% to 3.75% target range, extending this year's streak to four straight meetings without a move. Bitcoin slipped below $65,000 following the decision. Fresh "dot plot" projections showed a more hawkish shift. The median year-end forecast for the federal funds rate rose to 3.8%, up from 3.4% in March. Nine of 18 policymakers now see at least one rate hike before year-end, reversing earlier expectations that had begun to price in possible cuts. The meeting also marked the first chaired by Kevin Warsh, who recently took over as Fed chair. Warsh did not submit his own dot-plot projection, leaving his personal policy stance unclear. Officials continue to point to inflation running above target as the central challenge. The move in the median projection suggests the committee's center has shifted meaningfully toward tighter policy, with policymakers actively modeling scenarios in which additional increases become necessary. Minutes from the June meeting are scheduled for release on July 8 and are expected to shed more light on internal discussions, including how Warsh plans to address persistent inflation pressures. For crypto investors, Bitcoin's dip below $65,000 reflected uncertainty rather than panic. While markets largely expected rates to hold, the hawkish lean in forward guidance added pressure on risk assets. Traders are likely to focus on three near-term drivers: the July 8 minutes as the next key catalyst; incoming economic data ahead of the next FOMC meeting, which could shift support for further hikes; and any public remarks from Fed officials, given how evenly split the committee appears. Nine policymakers signaling at least one hike represents half the committee, not a fringe view.