Bitcoin’s price fell after Fed officials signaled reluctance to cut rates; market reaction reflects renewed concerns that a “cautiously hawkish” tone from Chair Powell could strengthen the dollar and pressure high‑beta assets like crypto.
Immediate cause: Fed officials prefer inflation control over near‑term rate cuts.
Bitcoin fell to roughly $112,300 after Cleveland Fed President Beth Hammack said she would not support a rate cut if deciding tomorrow.
Market probabilities for a September cut dropped from 92% to 73% this week, increasing downside risk for crypto.
Bitcoin price drop front‑loaded: Fed caution after Jackson Hole remarks weighs on crypto; read analysis and next steps for traders.
What caused the Bitcoin price drop after Jackson Hole?
Bitcoin price drop followed comments from Fed officials emphasizing inflation control and hesitation on near‑term rate cuts. Cleveland Fed President Beth Hammack said she would not support a rate reduction if the decision were made tomorrow, and market odds for a September cut fell sharply, prompting risk‑off selling in crypto.
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Market strategists, including Juan Leon of Bitwise, expected Powell’s Jackson Hole speech to lean “cautiously hawkish,” stressing sticky inflation and uncertainty around tariffs. That tone typically strengthens the dollar and raises real yields, creating a headwind for high‑beta assets such as Bitcoin and altcoins.
Bitcoin traded around $112,300 after a 1.6% one‑day decline, briefly hitting its lowest level since early July. Ethereum fell about 2.6% to $4,230. Solana and XRP declined roughly 3.5% and 3.4% respectively, reflecting broad risk‑off flows across crypto.
Cryptocurrency valuations are sensitive to real rates and dollar strength. When the Federal Reserve signals a preference for controlling inflation over easing, bond yields and the dollar tend to rise, reducing liquidity for speculative assets and increasing the cost of capital for risk assets.
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Source: https://en.coinotag.com/bitcoin-may-face-short-term-headwinds-if-powell-delivers-cautiously-hawkish-tone-bitwise-says/