Powell Signals Possible September Rate Cut, Bitcoin and Markets React Positively
August 22, 2026 — Federal Reserve Chair Jerome Powell surprised investors Friday with a dovish message at the Jackson Hole Economic Symposium, indicating that a rate cut in September could be on the horizon.
Powell highlighted increasing risks to employment, stating, “Downside risks to employment are rising. If those risks materialize, they can do so quickly in the form of sharply higher layoffs and rising unemployment.”
Following his remarks, Bitcoin rose about 2% to $114,200. U.S. stocks climbed over 1%, the 10-year Treasury yield dropped six basis points to 4.27%, the dollar index declined 0.5%, and gold prices gained 0.6%.
Market Movement Ahead of Powell’s Remarks
In the days leading up to the speech, cryptocurrencies and other risk assets faced selling pressure as markets priced in a hawkish Fed stance. Bitcoin had reached a record $124,000 just last week, supported by nearly 100% odds of a September rate cut. Those odds fell to 69%, dragging Bitcoin down nearly 10% to roughly $112,000.
Since Powell’s speech, rate cut probabilities have climbed back to around 90%, according to CME FedWatch, fueling Bitcoin’s recovery.
Ether (ETH) experienced a sharper fall, down roughly 12% from recent highs, before rebounding nearly 8% post-speech.
The Nasdaq Composite dropped 3% ahead of Powell’s remarks but rallied after his dovish tone.
