The price of Bitcoin and other cryptocurrencies saw a rise on Friday after remarks from Federal Reserve Chairman Jerome Powell, who suggested the possibility of an interest rate cut in Jackson Hole, Wyoming. Within 15 minutes of speech starting, Bitcoin jumped above $114,700 from $112,000, a nearly 2.5% gain, while Ethereum surged to $4,600 from $4,300, an almost 7% increase. Both cryptocurrencies saw declines of 2.9% and 1.4%, respectively, over the past week.
Altcoins saw a notable increase. XRP and Solana saw an impressive rise of more than 6% in less than an hour, with XRP exceeding the $3 threshold for the first time since Tuesday. Dogecoin experienced a rise of more than 7% during that time frame. Nonetheless, the majority of altcoins remained marginally down for the week, indicating investors’ ongoing apprehensions regarding the Fed’s future direction. A reduction in interest rates would probably bolster cryptocurrency and other risk-on assets by improving liquidity for investment. U.S. President Donald Trump has been exerting ongoing pressure on Powell to lower rates amid concerns regarding the slowing economy. It upheld a strong position concerning the central bank’s increased inflation risks tied to the labor market. He stated that the central bank is prepared to adjust its policy strategy if there arises a conflict between its dual mandate of achieving full employment and maintaining stable prices.
Caveating that the central bank is not on any preset course, stated, “the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance,” indicating that the central bank may lower interest rates at its September meeting. Inflation stemming from Trump’s tariffs has not been fully reflected in economic data, and this scenario may continue for several months. “It will continue to take more time for tariff increases to work their way through supply chains and distribution networks,” he stated. “Come what may, we will not allow a one-time increase in the price level to become an ongoing inflation problem.” Experts indicate that Bitcoin and various cryptocurrencies experienced a decline earlier this week in anticipation of final address in Jackson Hole as Fed chair.
As markets prepare for a slowdown in September, it was observed that “cautiously hawkish” comments could disappoint investors. Senior Investment Strategist Juan Leon expressed to Decrypt on Thursday his expectation that it would focus on ongoing inflation and tariff uncertainty, while avoiding any firm commitment to a rate cut in September, which could apply pressure on risk-on assets with a more assertive tone.