US Federal Reserve Chair Jerome Powell hinted at a potential rate reduction to come in September in a speech at the Fed’s annual symposium in Jackson Hole, Wyoming.
Fed Chair Powell Hints at Potential Rate Cuts in September, BTC Jumps
22 August 2025 - 17:51 CEST
A curious balance
The Fed Chair also gave a frank view of the competing factors the central bank weighs when determining monetary policy.
He noted that the US labour market is in a “curious kind of balance” and that despite recent rising inflation, “the downside risks to employment are rising.” He continued that the risks of “sharply higher layoffs and rising unemployment” may materialize rapidly.
Speaking about tariffs and inflation, Powell added:
“The effects of tariffs on consumer prices are now clearly visible. We expect those effects to accumulate over coming months, with high uncertainty about timing and amounts.”
The impact of the tariffs, some of which are still to be (re)negotiated, may be a “more lasting inflation dynamic” or a “one-time shift,” he added.
It was a predictably extensive speech that toured the many outcomes of current economic indicators. Importantly, Powell included a glimmer of hope for those traders seeking a rate cut to boost financial markets sentiment: “the stability of the unemployment rate and other labour market measures allows us to proceed carefully as we consider changes to our policy stance,” he said.
Market reaction
While Powell did not fully commit one way or another regarding a rate cut, as the matter will be voted on at the next Fed FOMC meeting in September, crypto assets jumped in reaction to Powell’s speech. Major coins such as Bitcoin (BTC), Ether (ETH) and XRP all spiked quickly after Powell started his remarks.
Bitcoin leapt 4.4% from 14:00 UTC Friday through the early evening, then started to pare gains. ETH surged 13%, while XRP jumped 9% during a similar period.
