WASHINGTON (dpa-AFX) - Cryptocurrencies shrugged off the renewed trade tensions between the U.S. and China to focus on another rate cut by the Federal Reserve. Chair Powell on Tuesday acknowledged that the rising downside risks to employment have shifted the Fed's assessment of the balance of risks, bolstering rate cut expectations.
Overall crypto market capitalization increased almost 2 percent overnight in response to the Fed Chair's comments. Positive flows to Bitcoin and Ethereum Spot ETF products in the U.S. and the dollar's retreat also supported sentiment.
Addressing the 67th Annual Meeting of the National Association for Business Economics, the Chairman of the Federal Reserve Jerome Powell sounded more dovish than what the markets had anticipated. Summarizing his speech on the topic 'Understanding the Fed's Balance Sheet', Jerome Powell acknowledged the tension between the Fed's employment and inflation goals.
According to Powell, available data and surveys continued to show that goods price increases primarily reflected tariffs rather than broader inflationary pressures. He noted that though near-term inflation expectations had generally increased this year, most longer-term expectation measures remained aligned with the Fed's 2 percent goal.
On the labor front however, Powell stated that payroll gains have slowed sharply and the downside risks to employment have apparently increased. The Fed Chief cited available evidence to suggest that both layoffs and hiring remain low, and that both households' perceptions of job availability and firms' perceptions of hiring difficulty continued their downward trajectories.
The Fed's concerns about the softening labor market and expectations that this worry would goad the Fed to ease rates boosted market sentiment. Gold has jumped; stocks have rallied while the Dollar has retreated.
Gold Futures for December settlement is currently trading at $4,220.06 per troy ounce, implying overnight gains of 1.4 percent. Gold Futures touched an all-time high of $4,235.69 earlier in the day's trade.
The 6-currency Dollar Index which measures the dollar's strength against a basket of 6 currencies is currently at 98.84, versus 99.05 at the previous close. The index has slipped 0.21 percent from the previous close.
Fed rate cut expectations remain firm. The CME FedWatch tool currently shows expectations of a quarter percentage rate cut in the next review which is two weeks away at 95.7 percent.
Only 4 of the top 100 cryptocurrencies have suffered overnight losses in excess of a percent. At the same time, around 75 of the top 100 cryptocurrencies have rallied more than 1 percent overnight. The rebound has lifted crypto market capitalization 1.94 percent overnight to $3.86 trillion. The 24-hour trading volume has however declined half percent overnight to $245 billion.
Bitcoin is currently trading at $112,742.42 recording overnight gains of 0.76 percent and weekly losses of 8 percent. BTC had ranged between $113,622.38 and $110,029.49 in the past 24 hours. The cryptocurrency is currently trading about 11 percent below the all-time-high of $126,198.07 touched on October 7.
Bitcoin-based Spot ETF products in the U.S. witnessed inflows of $103 million on Tuesday versus net outflows of $326 million on Monday. Fidelity Wise Origin Bitcoin Fund (FBTC) topped with inflows of $133 million.
Ethereum surged 3.8 percent overnight to trade at $4,157.74. Ether's current trading price is 16 percent below its all-time-high of $4,953.73 recorded on August 25, 2025. The 24-hour trading range was between $4,213.86 and $3,895.97.
Ethereum-based Spot ETF products recorded net inflows of $236 million on Tuesday versus net outflows of $429 million on Monday. Fidelity Ethereum Fund (FETH) topped with inflows of $155 million.
4th ranked BNB has slipped 1.2 percent overnight and more than 9 percent in the past week. It is currently changing hands at $1,191.61, around 13 percent below the all-time-high of $1,370.55 touched on October 13.
5th ranked XRP added 1.6 percent overnight to trade at $2.50, around 35 percent below the all-time high of $3.84 touched on January 4, 2018.
The price of 6th ranked Solana jumped more than 5 percent overnight to $206.42.
8th ranked Dogecoin added 2 percent overnight and is currently changing hands at $0.2044. With losses of 35.3 percent, DOGE is the highest-ranking cryptocurrency to record losses on a year-to-date basis.
TRON ranked 9th overall gained 2.8 percent overnight and is currently changing hands at $0.3206.
10th ranked Cardano gained 2.3 percent overnight to trade at $0.6996.
79th ranked Plasma (XPL) topped overnight gains among the top 100 cryptocurrencies with a gain of 19.9 percent. 29th ranked Zcash (ZEC) also added close to 16 percent overnight.
86th ranked Artificial Superintelligence Alliance (FET) topped overnight losses among the top 100 cryptocurrencies with a decline of more than 8 percent. 94th ranked MYX Finance (MYX) also erased 6.1 percent in the past 24 hours.
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