Ethereum News Today: Bitcoin and Ethereum surge on Fed easing expectations after Powell's Jackson Hole remarks

The Federal Reserve’s decision to signal a potential rate cut in September sent ripples through global financial markets, with Bitcoin and Ethereum experiencing sharp intraday gains following Federal Reserve Chair Jerome Powell’s speech at Jackson Hole [3]. Although Powell did not provide a definitive timeline for the reduction, his remarks were interpreted as a pivot toward a more accommodative monetary policy, reinforcing expectations that easing is on the horizon [3].

Prediction markets, particularly Polymarket, reflected this sentiment, with the odds of a September rate cut rising to 78% for a 25 basis point reduction [1]. These probabilities had previously fluctuated, dropping to 57% ahead of the speech amid concerns over hotter-than-expected PPI data [1]. However, Powell’s nuanced but open-ended comments restored confidence, with market participants increasingly pricing in a Fed that is willing to adapt to shifting economic conditions [3].

The immediate response in the cryptocurrency markets was notable. Bitcoin surged from below $112,000 to over $117,000 within hours, while Ethereum climbed to $4,878, briefly hitting a record high [6]. These gains were not isolated to the top two digital assets—altcoins such as XRP and Solana also saw gains of more than 6% within a short period [4], and Dogecoin mirrored Ethereum’s performance with a 7% intraday rise [4]. Despite the sharp rally, both BTC and ETH ended the week down by 2.9% and 1.4%, respectively, highlighting the continued uncertainty and caution among investors [3].

Analysts suggest the market had already priced in a rate cut to some extent, but Powell’s speech lacked the expected “hawkish” language that could have tempered expectations [3]. Myriad Linea’s latest market poll showed a sharp increase in expectations for a rate cut, with 87% of respondents now anticipating a move, up from 70% earlier in the week [3]. This growing consensus indicates that investors are preparing for a more dovish Fed, especially given President Donald Trump’s repeated calls for easing amid fears of a slowing economy [3].

Ethereum, in particular, has shown stronger momentum in the wake of Powell’s comments, surging 13% on Friday and forming what some traders describe as a “god candle”—a technical signal often associated with bullish reversals [5]. Marcin Kazmierczak of RedStone noted that the Fed’s cautious tone suggests a measured approach to easing, which could provide a supportive backdrop for Ethereum as it tests key resistance levels [1]. However, he also warned that any sustained rally would need to be underpinned by real-world adoption, rather than solely speculative bets on monetary policy [1].

While the Fed has not committed to a specific path, Powell emphasized that it is not on a “preset course,” leaving room for future adjustments based on incoming data [3]. This flexibility has added a layer of uncertainty, but overall, the market appears to be leaning toward a more accommodative stance, with Bitcoin and Ethereum benefiting from renewed risk appetite [2].

Source:

[1] Cryptopotato (https://cryptopotato.com/september-rate-cut-odds-surge-after-powell-whats-next-for-btc-and-eth/)

[2] Investopedia (https://www.investopedia.com/bitcoin-and-crypto-stocks-surge-as-powell-rate-cut-hint-revives-risk-appetite-11795898)

[3] Yahoo Finance (https://finance.yahoo.com/news/ethereum-bitcoin-spike-powell-signals-143138288.html)

[4] Mitrade (https://www.mitrade.com/insights/news/live-news/article-3-1063695-20250823)

[5] Cointelegraph (https://cointelegraph.com/news/eth-god-candle-emerges-amid-fed-rate-cut-hopes-is-dollar6k-ether-next)

[6] Coinpedia (https://coinpedia.org/news/ethereum-price-hits-all-time-high-after-powells-rate-cut-signal/)

[7] Mitrade (https://www.mitrade.com/insights/news/live-news/article-3-1063753-20250823)

[8] The Economic Times (https://m.economictimes.com/news/international/us/cryptocurrency-spikes-after-after-powell-hints-at-rate-cut-bitcoin-ethereum-litecoin-surge-is-momentum-finally-here/articleshow/123457352.cms)