Crypto Feels the Chill as Powell’s Hawkish Comments Resonate

Expectations for a December rate cut by the U.S. Federal Reserve are now less certain following recent comments from Chairman Jerome Powell.

After a strong rally in the crypto markets driven by the aftermath of Donald Trump’s election, prices took a brief dip on Thursday following Powell’s speech. The Federal Reserve Chair noted that the economy was showing no immediate signs of needing a rate cut, adding that “the strength we are currently seeing in the economy gives us the ability to approach our decisions carefully.”

Bitcoin (BTC) slid by 1.5% to $88,300 in the minutes after Powell’s remarks, continuing its decline to $88,000, a 3.2% drop in the past 24 hours. Ether (ETH) also experienced a similar decline. On the flip side, the broader CoinDesk 20 Index posted a modest 0.5% increase, primarily led by a 13% rise in Ripple (XRP), possibly fueled by SEC Chair Gary Gensler’s statements that some speculate could signal his departure after Trump’s win.

The probability of a rate cut in mid-December has dropped significantly, now standing at 62% according to CME FedWatch, down from 83% a day earlier.

Meanwhile, traditional financial markets saw a slight pullback, with the Nasdaq falling by 0.75% as investors digested Powell’s hawkish tone.

Crypto markets, however, continue to show strong performance. Bitcoin remains up 15% week-over-week, and other altcoins like Cardano (ADA), Ripple (XRP), NEAR, and Stellar (XLM) are all seeing impressive gains between 20% and 40% over the same period.