The price of bitcoin fell sharply on Thursday morning, falling to a low of $107,000 as traders digested cautious remarks from Federal Reserve Chairman Jerome Powell and mixed signals from the latest Trump-Xi meeting.
The decline in bitcoin’s price erased last week’s rebound and prolonged bitcoin’s weak performance in October, weighed down by unfavorable macroeconomic factors and trade relations between China and the United States.
According to data from Bitcoin Magazine Pro, the world’s largest cryptocurrency fell to $107,472 early Thursday, after briefly tumbling to $107,925 overnight.
Bitcoin Price Reacts to Jerome Powell’s Comments
The move followed the Fed’s 25 basis point rate cut on Wednesday – its second of 2025 – bringing the target range to 3.75%–4%. While the cut was widely expected, Powell’s message was clear: Further easing this year is far from guaranteed.
There are “strongly differing opinions among policymakers,” Powell said at his post-meeting news conference, adding that the Fed could “wait a cycle” before considering another reduction.
The remarks rattled markets that had priced in a cut in December, with CME FedWatch data showing the odds for another move fell from 90% to just 71% after his comments.
Risky assets weakened broadly yesterday. The S&P 500 closed unchanged, the Dow Jones Industrial Average slipped 0.2% and the Nasdaq Composite posted a modest gain of 0.6%. As of this writing, markets for Thursday also look gloomy.
Bitcoin, which was trading near $116,000 earlier in the week, fell as Powell spoke, briefly hitting $109,000 in a sharp sell-off before settling near $111,000 overnight.
The Fed’s tone also overshadowed what appeared to be a positive outcome of the Trump-Xi summit. After the meeting, President Trump said that China will “immediately resume soybean purchases” and that “all rare earth issues have been resolved.”
However, it appears that traders remained cautious, focusing instead on the Fed’s aggressive turn and the ongoing US government shutdown, now entering its fourth week.
Institutional demand also showed the first signs of weakness. U.S.-listed spot Bitcoin ETFs saw outflows of $470.7 million on Wednesday, ending a four-day streak of inflows and marking the largest daily outflow since Oct. 16, according to data from Bitcoin Magazine Pro.
Will the price of bitcoin react to the end of Quantitative Tightening?
Powell confirmed that the Fed is nearing the end of its quantitative tightening (QT) program, a move that could eventually boost liquidity in risky assets.
Since 2022, QT has drained nearly $1 trillion from the Fed’s balance sheet by allowing Treasuries and mortgages to mature without reinvestment.
Powell said the trial could conclude by December, but cautioned that future decisions remain data-dependent. Despite the sharp correction, analysts remain divided on Bitcoin’s near-term direction.