Powell’s Hawkish Commentary Sends Bitcoin Down to $110,000

Bitcoin Falls Below $110K as Powell Tempers Hopes for December Rate Cut

Bitcoin tumbled on Wednesday after Federal Reserve Chair Jerome Powell struck a more hawkish tone than markets expected, warning that a December rate cut was “far from a foregone conclusion.”

The comments came just hours after the Fed trimmed its benchmark rate by 25 basis points to a range of 3.75%–4.00%, matching market expectations. Despite the cut, Powell’s cautious messaging sent shockwaves across risk assets that had priced in a near-certain follow-up cut later this year.

Bitcoin (BTC) fell nearly $2,000 in minutes following Powell’s remarks, sliding to around $109,600, a 5% drop over 24 hours and erasing its earlier weekly gains. Equity markets also reversed, with major indexes turning lower as the 10-year Treasury yield jumped eight basis points to 4.06% and the U.S. dollar strengthened.

Futures markets reflected the shift in sentiment, with the odds of a December rate cut falling to 69% from 90% earlier in the day, according to CME FedWatch.

While acknowledging “some softening” in the labor market, Powell emphasized that inflation “remains somewhat elevated,” signaling that policymakers remain cautious about over-easing. The meeting’s vote wasn’t unanimous, with Kansas City Fed President Jeffrey Schmid dissenting in favor of holding rates steady.

Analysts said the central bank now faces a difficult balancing act amid the ongoing government shutdown and limited access to key economic data.

“The shutdown’s data blackout means the Fed is flying blind,” said Marcin Kazmierczak, co-founder of RedStone. “That unpredictability alone is enough to drive volatility in bitcoin and risk assets through year-end.”

Crypto traders echoed similar sentiment. Paul Howard, director at Wincent, said Powell’s remarks have dampened near-term sentiment but could set the stage for accumulation.

“Bitcoin’s still range-bound between $110K and $120K,” Howard said. “If macro conditions improve into November, this pullback may prove short-lived before year-end consolidation.”

Despite the rate cut, the Fed’s tone suggests it’s not ready to pivot fully toward easing — a stance that continues to weigh on both crypto and traditional markets.