Fed keeps interest rates up and higher inflation reduces chances of cuts in 2026.

• Federal Reserve keeps interest rates unchanged for the fourth consecutive meeting.
• High inflation dampens expectations of interest rate cuts.
• Market monitors impact on assets and Bitcoin.

The Federal Reserve decided to keep interest rates unchanged for the fourth consecutive meeting in 2026, reinforcing a more cautious stance in the face of persistent inflation in the United States. The decision was unanimously approved by the members of the Federal Open Market Committee (FOMC), something that had not happened since the middle of last year.

With the benchmark interest rate remaining between 3,5% and 3,75%, the US central bank has signaled that it still sees no room for easing monetary policy. On the contrary, the most recent projections show that a growing number of policymakers are considering the possibility of further interest rate hikes before any cuts are discussed in the coming years.

The updated estimates represent a significant shift from the forecasts released in March. At that time, some Fed members indicated the possibility of rate cuts in 2026. Since then, however, the combination of a more resilient labor market and accelerating inflation has altered the economic landscape.

Among the 18 officials who presented projections for interest rates, eight advocate maintaining the current rate throughout this year. Another three project an increase, while five expect two upward adjustments. One member believes that up to four increases may be necessary.

The statement released after the meeting also brought relevant changes. The Federal Reserve removed passages that suggested the institution's next move could be an interest rate cut. Instead, the monetary authority highlighted that the economy continues to grow at a pace considered solid, despite uncertainties related to the conflict in the Middle East and its effects on energy prices.

"The committee will ensure price stability," officials said in a statement.

New projections indicate that headline inflation could reach 3,6%, above the previously estimated 2,7%. Core inflation, which excludes more volatile components, has been revised to 3,3%.

The latest data from the Consumer Price Index (CPI) showed a 4,2% annual increase in May, the highest level in three years. The core CPI rate reached 2,9%, remaining above the 2% target pursued by the Fed.

The Personal Consumption Expenditures (PCE) index, closely monitored by the institution, also remains under pressure. The underlying measure registered 3,3% in April, and expectations point to a further increase in May.

In addition to inflation, the Federal Reserve revised its projections for economic activity. The expectation for Gross Domestic Product (GDP) growth was reduced to 2,2%, while the unemployment rate is now estimated at 4,3%.

The meeting also marked Kevin Warsh's debut as chairman of the Federal Reserve. The meeting was closely watched by global markets, including Bitcoin and cryptocurrency investors, who are monitoring the next steps in US monetary policy due to the direct influence of interest rates on liquidity and risk appetite in financial markets.