Fed Under Pressure: Will Powell’s Speech Keep the Crypto Rally Alive?

The crypto market is entering a decisive week as all eyes turn to the FOMC meeting on September 16–17 and Fed Chair Jerome Powell’s speech. Investors expect the first rate cut of 2025, but the real question is whether Powell’s words will fuel the rally—or cut it short.

Altcoins Take the Lead Global crypto market capitalization has climbed to $4.06 trillion, up 6% over the past week. Bitcoin has stabilized near $116,000, but its dominance has slipped to 57%, the lowest in eight months. This shift has given altcoins room to shine. Ethereum (ETH) gained 8.2% this week, trading at $4,644 on the back of strong ETF inflows. Solana (SOL) surged 17.1%, with its total value locked crossing $13 billion. The ETH/BTC ratio is also up 3.8%, signaling a clear rotation into altcoins.

Why the Fed’s Move Matters Markets are pricing in a 25 basis point rate cut, with CME futures giving it a 93% probability. Such a move typically boosts risk assets like digital currencies. But economic data has sent mixed signals. Inflation ticked higher in August: the CPI rose 0.4% month-over-month, pushing annual inflation to 2.9%. Producer prices fell 0.1% on the month but increased 2.6% year-over-year. Meanwhile, the labor market slowed sharply, with just 22,000 new jobs created and unemployment climbing to 4.3%.

Powell’s Words Could Tip the Scales The cut itself may already be priced in, making Powell’s forward guidance the real market mover. If he signals more cuts ahead, the crypto rally could extend further—especially for outperforming altcoins. But if he takes a cautious “wait-and-see” stance and emphasizes the inflation fight, investors may take profits, cooling momentum. Skeptics like Peter Schiff warn that Bitcoin could be nearing its peak.

The Deciding Moment With Bitcoin losing ground to altcoins and the Altcoin Season Index above 70, momentum has clearly shifted. But Powell’s speech this week is the key. It could either extend the bullish wave into the months ahead—or mark the point where the rally pauses and volatility returns.

#bitcoin , #crypto , #Fed , #Powell , #CryptoMarket

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