Bitcoin, Ether Rebound Ahead of Fed Meeting as Rate Cut Looms

Altcoins have dominated recent crypto gains, but bitcoin (BTC) and ether (ETH) staged a sharp late-week rally on Friday as markets brace for next week’s Federal Reserve policy decision.

Bitcoin climbed 2% in the final hours of U.S. trading to $116,600, while ether advanced 5% to $4,650. Both tokens are now at their highest levels since mid-August, when volatility spiked following Fed Chair Jerome Powell’s Jackson Hole remarks.

At that time, Powell shifted from a hawkish to a dovish tone, emphasizing labor market weakness over inflation concerns. Traders swiftly priced in a September rate cut, moving expectations from uncertain to virtually guaranteed.

In the immediate aftermath, BTC surged from $112,000 to over $117,000, while ETH rocketed more than 16% in under 48 hours, nearly reaching $5,000 for the first time. Those rallies quickly reversed, however, with bitcoin sliding to $107,000 and ether returning near pre-speech levels by the end of August.

The upcoming Fed meeting is expected to deliver the first rate cut in a year, with consensus pointing to a 25 basis point reduction, lowering the benchmark range to 4.00%–4.25%. Traders see the decision as a key catalyst for crypto markets as capital reallocates between bitcoin, ether, and leading altcoins such as solana (SOL) and dogecoin (DOGE), which have surged 17% and 25% respectively over the past week.