Bitcoin experienced a significant surge of $1,100 in just 10 minutes following Federal Reserve Chair Jerome Powell’s remarks during his Jackson Hole speech. On August 23, ahead of the Federal Reserve’s policy meeting in September, Powell stated, “The time has come for policy to adjust.” His comments highlighted the Fed’s confidence in achieving a 2% inflation rate, suggesting potential rate cuts on the horizon.

The price of Bitcoin briefly traded above $62,000 before retracing as the broader cryptocurrency market adjusted. The public consensus attributed Bitcoin’s brief surge to Powell’s comments. However, Powell noted that incoming data would determine the extent to which the Fed implements looser monetary policies.

Slashed interest rates could be bullish for Bitcoin’s price and the broader cryptocurrency market.

Typically, reduced funding rates lead to improved liquidity and a greater appetite for risk assets, which often include Bitcoin and other digital assets. With the U.S. stock market and gold trading at all-time highs, there is speculation that capital seeking new profits could flow into Bitcoin.

After Bitcoin’s decline to $49,000 following Black Monday earlier this month, the asset has been trading within a range of $53,000 to $61,000 for weeks. Spot Bitcoin exchange-traded funds (ETFs) recorded varied flows but had attracted incoming capital for six consecutive days at the time of writing.

Several factors could bolster Bitcoin’s bullish outlook, including the reduced supply from April’s halving, which cut block rewards by 50%, ETF buying, and potential rate cuts. After Powell’s Jackson Hole speech, Bitcoin was trading at $61,500, following what some termed as a “test pump.”

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