The Fed does not lower rates… The dollar plunges

The dollar, once a symbol of stability and a pillar of the global economy, is faltering. Yet, neither Beijing nor Moscow is largely to blame this time. The fragility has settled in Washington. Between hesitant decisions by the Federal Reserve and political calculations of the White House, the monetary balance is cracking. The pause decided by the Fed has opened a breach: that of a market now operating without it. And into this gap, speculation, gold, and even bitcoin rush in.

The Fed presses “pause”, but the market keeps running

The Federal Reserve kept its key rates between 3.5% and 3.75%, the first pause since last July. Jerome Powell invokes a “data-dependent” approach, preferring to observe before acting. Yet this status quo masks a split: Stephen Miran and Christopher Waller voted for an additional cut.

But the earthquake comes from elsewhere. While the Fed delays, the dollar falls apart. After a disastrous 2025, it reaches its lowest level in four years. A phrase from Donald Trump, dropped offhandedly, was enough to intensify the fall: “The value of the dollar is excellent“.

This message immediately made the currency slip. For David Ingles, from Bloomberg TV:

President Trump might, in practice, be lowering rates instead of the Fed, by letting the dollar slide.

The market acts as if monetary easing had already begun.

The economy reacts: a weak dollar, wavering confidence

Far from press releases, the impact is felt in the real economy. Growth remains solid and unemployment stable at 4.4%, but household confidence drops to its lowest level since 2014. The weakening of the dollar, perceived as a political choice, increases uncertainty.

A weak dollar makes exports more competitive, but raises import prices and sustains inflation. This double effect puts the Fed in an untenable position. Jerome Powell acknowledged it:

If people lose faith that we make our decisions solely based on our assessment of what is best for the public as a whole, rather than favoring one group or another, it will be difficult to preserve that independence.

In this context, safe havens soar: gold reaches $5,350 per ounce, silver rises by 10%. These increases reflect a loss of confidence in institutions. And when investors doubt central banks, they turn to bitcoin.

The dollar wavers, bitcoin regains its role as a free asset

The weakness of the dollar acts like hidden monetary easing. As monetary policy weakens, the crypto-sphere comes back to life. Bitcoin, in particular, regains its role as a free asset: it trades around $88,000, a symbol of renewed confidence.

Analysts at Global Macro Investor remind us that “a strong dollar is a bludgeon for risk assets“. Conversely, its decline favors the return of cryptos to portfolios. This inverse correlation between the DXY and BTC asserts itself again: when the currency falls, bitcoin thrives.

In a world where markets doubt the Fed, bitcoin becomes a thermometer of economic credibility. It obeys no bank but perfectly reflects global investors’ confidence.

Key figures and facts to remember

• Fed rates: 3.5% – 3.75%;
• Dollar: lowest in 4 years, -10% in 2025;
• Gold: historic record at $5,350 per ounce;
• Bitcoin price (BTC): $88,046 at the time of writing.

The Fed delays, but markets emancipate themselves. The dollar wobbles, confidence erodes, and bitcoin regains its place as an alternative asset. An analyst already mentions an unprecedented seasonality for the queen of cryptos — proof that the global economy, more than ever, is seeking new landmarks.