Powell Stands Firm Despite Growing Dissent—What It Means for Your Crypto Portfolio

Fed Chair Jerome Powell just doubled down on his hawkish stance—and the crypto markets are feeling the heat. Here's why his unwavering position could trigger your next trading opportunity.

The Powell Doctrine: No Retreat, No Surrender

While internal dissent grows louder, Powell's playing monetary policy on hard mode. No pivot in sight—just relentless inflation combat that's shaking both TradFi and DeFi cages.

Crypto's Paradox: Short-Term Pain, Long-Term Gain?

History shows Fed rigidity fuels decentralized finance adoption. This time? Bitcoin maximalists are already crowing 'I told you so' while altcoin traders sweat their leveraged positions.

The Bottom Line: Powell's stubbornness might just be the stress test crypto needs—assuming your portfolio survives the liquidity crunch. (Wall Street analysts remain 'cautiously optimistic'—which means they're secretly panic-selling.)

Despite the hardline stance against any sort of easing from Powell, the committee was much less aligned beneath the surface about the path of policy. 

For the first time in 30 years, we saw two FOMC governors dissent on the decision. Governor Waller and Governor Bowman both dissented to cutting rates at this meeting. 

A dissent of this magnitude highlights the fork in the road in the context of US monetary policy.

Governor Waller has advocated for preemptive insurance cuts due to what he sees as emerging risks in the labor market and a high conviction that tariff inflation will be transitory. 

Contrasting the unemployment rate with the “jobs hard to get less jobs plentiful” data point, you can see where he’s coming from regarding emerging risks to the labor market. 

That said, it’s clear that inflation is starting to tick up due to tariffs. Today we received Core PCE data (the Fed’s preferred inflation metric), and no matter which way you try to annualize the data, it’s clear that inflation is skewed higher, not lower.

Picking apart services inflation from goods, it becomes crystal clear that the stickiness of inflation is being manifested by higher goods inflation brought on by tariffs. This is quite different from the past two years, where goods were outright deflationary and it was services propping things up:

This combination — paired with continued political pressure for it to cut rates — puts the Fed in a tough place. 

When Powell was asked about whether he was willing to “look through” tariff-related inflation as a one-time price adjustment, he sternly responded that “by not hiking rates right now, we already are.” 

That sounds like a shot across the bow directly at the TRUMP administration. As we finish off the data-heavy week, tomorrow’s jobs report — if it comes in hot — could well be the nail in the coffin for any potential rate cut in September.

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