Crypto markets saw a brief retreat late Thursday after Federal Reserve Chairman Jerome Powell’s comments raised doubts about an imminent rate cut, impacting investor sentiment.
Bitcoin (BTC) experienced a slight drop of around 1.5%, slipping to $88,300 following Powell’s speech at a conference in Dallas. By the time of writing, the price had further dipped to $88,000, marking a 3.2% decrease in the past 24 hours. Ether (ETH) mirrored this decline. Despite these losses, the broader CoinDesk 20 Index managed to rise by 0.5%, buoyed by a 13% surge in Ripple (XRP), possibly fueled by SEC Chair Gary Gensler’s comments hinting at potential changes in his role after Donald Trump’s victory.
Powell’s remarks signaled that the economy is not showing urgent signs to lower interest rates, allowing the Fed to approach decisions with caution. This has caused market expectations for a December rate cut to fall from 83% to 62%, according to CME FedWatch, decreasing investor optimism surrounding a quick rate cut.
The reaction was not limited to crypto markets. Traditional markets also pulled back, with the Nasdaq experiencing a 0.75% drop, reflecting the broader shift in sentiment.
Despite the short-term dip, the cryptocurrency sector remains in a strong uptrend, with Bitcoin posting a 15% gain week-over-week. Altcoins such as Cardano (ADA), Ripple (XRP), and Stellar (XLM) have also seen impressive gains, ranging from 20% to 40% over the same period.
