Where Is Bitcoin Headed Next Following Fed Chair Powell’s Remarks?

Neither the U.S. central bank’s decision to drop the interest rate nor Federal Reserve Chair Jerome Powell’s measured comments following the announcement stirred Bitcoin much on Wednesday.

But analysts whom Decrypt spoke to are largely upbeat that the asset’s price would gain ground throughout the remainder of the year. 

Powell’s emphasis on a sagging employment market and wider concerns will likely result in additional rate cuts, sending Bitcoin and other cryptocurrencies higher, they said. They also noted other factors, including the growth of crypto treasuries, as a boon.

“Powell framed today’s move as a ‘risk-management cut’ and noted there was no big push for a 50 bps move, even as the statement flagged slowing job gains and still-elevated inflation,” Ira Auerbach, former head of digital assets at Nasdaq and current head of tandem at Offchain Labs, told Decrypt. “The FOMC’s statement and projections sketch a data-dependent path to more cuts in the near future. Easier financial conditions ahead should be supportive of the crypto ecosystem.”

Earlier Wednesday, the Fed lowered the federal funds rate that it sets for overnight lending between commercial banks to a range between 4.25% and 4.50%.

This year’s first cut came after leaving rates unchanged throughout five monetary policy meetings and after months of intense pressure from U.S. President Donald Trump, who has been sensitive to being saddled with a sagging economy. 

But declining employment numbers, including a more than 900,000 downward adjustment in the number of jobs created over a year-long period ending this March, swayed the bank to act. 

“Risks to inflation are tilted to the upside and risks to employment to the downside, a challenging situation when…our framework calls for us to balance both sides of our dual mandate, with downside risk to employment having increased, the balance of risks has shifted accordingly,” Powell told reporters, even as he noted that “higher tariffs have begun to push up prices in some categories of goods.”

Bitcoin Steady as Fed Cuts Interest Rates for First Time Since December

Six hours following the announcement, Bitcoin was trading near $117,000, roughly flat over the past 24 hours, according to crypto data provider CoinGecko, as investors had accounted for the rate cut. Prices have since cooled slightly to $116,600.

Stocks and other risk-on assets were similarly unimpressed with the tech-heavy Nasdaq and S&P 500 both dipping. Crypto and equity markets had rallied in the days leading up to the announcement, with Bitcoin climbing 2% over the past week.