Bitcoin reclaims $116K, Ether, XRP push larger after Fed’s Powell hints at doable charge cuts

August 22, 2025

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Key Takeaways

Bitcoin surged above $116,000 following Federal Reserve Chair Powell’s sign of doable charge cuts.
Powell emphasised a data-driven strategy to financial coverage, citing resilience within the financial system and ongoing inflation considerations.

Bitcoin climbed over 3% on Friday to commerce above $116,000 as optimism in crypto markets picked up after Federal Reserve Chair Jerome Powell gave a cautious sign that the central financial institution might transfer towards reducing rates of interest.

Talking on the Fed’s Jackson Gap occasion, Powell famous that inflation continues to be “considerably elevated” however has eased considerably from post-pandemic highs.

The Fed is dealing with a fragile steadiness, he stated, with upside pressures on inflation and draw back pressures on employment. He added that the present coverage charge is nearer to impartial and the labor market is steady, giving the Fed room to proceed cautiously.

“The baseline outlook and the shifting steadiness of dangers might warrant adjusting our coverage stance,” Powell stated.

“Financial coverage shouldn’t be on a preset course. FOMC members will make these selections based mostly solely on their evaluation of the info and its implications for the financial outlook and the steadiness of dangers,” Powell confused.

In accordance with the central financial institution chief, tariffs might push inflation larger, however the base case is that worth will increase will likely be short-lived. The Fed stays vigilant in opposition to stagflation and is dedicated to its 2% inflation goal.

Powell’s remarks rapidly lifted crypto and inventory markets as buyers learn the speech as extra dovish than anticipated.

Bitcoin hit $116,000 after retreating under $112,000 earlier this week in anticipation of Powell’s hawkish stance, whereas different main crypto belongings additionally moved larger following the speech.

Ethereum jumped 7% to $4,600. XRP, Solana, and Chainlink every gained over 6%, whereas Dogecoin and Cardano rose round 8% on the speech.

The entire crypto market capitalization surpassed $4 trillion, rising by 2% in a day.

Merchants at the moment are overwhelmingly betting the Fed will ship a quarter-point charge lower in September, with odds lifting to almost 90% from simply 75% within the earlier session, in accordance with FedWatch Software information.