The Federal Reserve wrapped up its June meeting with a familiar message: patience. Chair Jerome Powell kept interest rates unchanged for the fourth straight meeting, signaling a steady-hand approach as the Fed navigates an evolving economic and geopolitical landscape. The key message from Powell was to “hold and learn more”—a cue that rate cuts aren’t off the table, but the path forward remains data-dependent.

The updated Summary of Economic Projections (SEP) points to just one potential rate cut this year—a subtle but notable shift that reflects growing internal division within the Fed. Advisors should note that the committee remains split, with some members worried about persistent inflation (particularly from tariffs), while others see softening indicators as a sign the Fed could ease later this year.

This divergence makes clear that policy clarity may remain elusive in the near term. For portfolios sensitive to interest rates—such as fixed income, dividend-paying equities, and real assets—advisors may want to stress test allocations under multiple scenarios.

The latest retail sales report showed the slowest growth since 2023, particularly in food service spending—a reliable gauge of discretionary behavior. While e-commerce continues to hold up, much of that strength appears to be promotion-driven rather than organic demand.

That said, Powell struck a more constructive tone on employment. Unemployment remains at 4.2%, job creation is steady, and wage growth is still trending in the right direction. For advisors, this mixed picture reinforces the need for a balanced approach across client portfolios: not overly defensive, but mindful of fatigue in key consumer segments.

During the press conference, Powell addressed questions around the Supplementary Leverage Ratio (SLR)—a hot topic for financial institutions. His tone was cautious, suggesting any regulatory tweaks would be modest and unlikely to meaningfully shift capital flows or bank appetite for Treasuries. Advisors with clients in bank-heavy equity positions or fixed income products tied to Treasury market dynamics may want to temper expectations for near-term catalysts.

Tensions in the Middle East have reentered the conversation. Hawkish rhetoric toward Iran, particularly from the Trump campaign, added to recent volatility across risk assets. Bitcoin, which often reacts sharply to geopolitical stress, experienced a brief pullback.

Meanwhile, the International Energy Agency (IEA) released a downbeat outlook on oil demand, citing slowing global growth and the steady march of electric vehicle adoption. Energy-exposed portfolios could face pressure as OPEC+ output and supply projections stretch into a potential surplus through 2026.

A bipartisan win in the Senate (68–30) advanced a landmark stablecoin bill backed by former President Trump. If enacted, the legislation would require stablecoin issuers to maintain full dollar reserves—a move toward transparency that could pave the way for broader crypto adoption within the financial system.

For advisors navigating increasing client curiosity about digital assets, this regulatory development offers a potential anchor. It also signals a shift in tone on Capitol Hill, though the House still must weigh in before any framework is finalized.

Despite the noise, crypto markets continue to show strength. Bitcoin and Ethereum both posted inflows this week—over $1 billion into Bitcoin, and $129 million into Ethereum—highlighting enduring investor conviction. For clients with a long-term horizon and an appetite for innovation, digital assets are proving to be more than a speculative trade.

With the Fed in a holding pattern and global crosscurrents still developing, now is a good time to revisit client portfolios through the lens of resilience. Balanced exposure, selective credit, and longer-term themes like digital infrastructure and regulated crypto may offer compelling ways to navigate what’s shaping up to be an uncertain second half of 2025.

For more news, information, and strategy, visit the CoinShares Crypto ETF Hub.