Bitcoin price fell below 112,000 dollars during Monday trading, erasing the sharp gains sparked by cautious remarks from Federal Reserve Chairman Jerome Powell, while Ethereum, the world’s second-largest cryptocurrency, traded near record levels.

The world’s largest cryptocurrency last traded down 3% at 111,610 dollars as of 06:21 a.m. Eastern time (10:21 GMT). The coin had fallen in the previous session to nearly a six-week low of around 111,000 dollars, as traders took profits after Friday’s surge.

Bitcoin erases gains from rate cut bets

Bitcoin jumped above 117,000 dollars on Friday following Powell’s cautious comments at the Jackson Hole symposium, where he acknowledged rising risks to the labor market and hinted that “the shift in the balance of risks may warrant adjusting our policy stance.”

Powell’s signal of a possible rate cut in September boosted investor sentiment, driving up risk assets including cryptocurrencies. But Bitcoin later retreated as investors moved to take profits, with analysts pointing to resistance levels and a phase of consolidation as factors behind the decline.

Japanese finance minister pledges supportive framework for cryptocurrencies

Japanese Finance Minister Katsunobu Kato said on Monday that the government would work to establish a suitable environment for digital assets. He noted that cryptocurrencies could be part of diversified investment portfolios, signaling an evolving stance toward broader market adoption.

His remarks came amid ongoing efforts to clarify regulatory rules and investor protection mechanisms in the sector. The approach reflects Japan’s commitment to balancing innovation with financial stability, at a time when authorities increasingly recognize the growing role of crypto assets in investment strategies.

Silver prices fell in the European market on Monday for the first time in four days, giving up a four-week high, amid active correction and profit-taking, in addition to pressure from the rebound of the US dollar against a basket of global currencies.

After cautious remarks by Federal Reserve Chairman Jerome Powell at Jackson Hole raised the likelihood of a US interest rate cut in September, investors this week await more new evidence on monetary easing in the United States.

Price Overview

Silver prices today: Silver fell by 0.45% to 38.72 dollars, from the opening level of 38.89 dollars, recording a high of 39.00 dollars.

At Friday’s settlement, silver gained 1.95%, its third consecutive daily advance, hitting a four-week high of 39.07 dollars an ounce, supported by the decline in the dollar and US yields.

The white metal posted a 2.3% weekly gain last week, its second weekly rise in the past three weeks, amid improved demand for non-yielding assets.

US Dollar

The dollar index rose on Monday by 0.25%, starting to recover from a three-week low of 97.56 points, reflecting a rebound in the US currency against a basket of global currencies.

In addition to buying from low levels, the US dollar strengthened at the beginning of the week, as markets await further evidence on the likelihood of a US rate cut in September.

US Interest Rates

Federal Reserve Chairman Jerome Powell said at Jackson Hole on Friday that shifting risk balances may require policy adjustments, with current indicators showing increasing downside risks to the labor market.

Following those comments, and according to CME Group’s FedWatch tool: the pricing of a 25-basis-point US rate cut in September rose from 75% to 87%, while the pricing of holding rates unchanged declined from 25% to 13%.

The pricing of a 25-basis-point US rate cut in October rose from 85% to 94%, while the pricing of holding rates unchanged fell from 15% to 6%.

To reprice these expectations, investors are awaiting important US economic data this week, particularly the Personal Consumption Expenditures report on Friday, along with a series of comments from Fed officials.

Oil prices rose on Monday as traders weighed concerns that Russian supplies could be disrupted by additional US sanctions and Ukrainian attacks targeting Russia’s energy infrastructure.

Brent crude futures climbed 39 cents, or 0.6%, to 68.12 dollars by 10:23 GMT, while US West Texas Intermediate futures rose 42 cents, or 0.7%, to 64.08 dollars.

Ole Hansen, head of commodity strategy at Saxo Bank, said: “The market is somewhat concerned that these peace negotiations will not yield any results.” He added: “Expectations point to supply exceeding demand in the autumn months, but in the short term this scenario is being challenged by the risk of geopolitical disruptions.”

US President Donald Trump warned again on Friday that he would impose sanctions on Russia if there was no progress toward a peace settlement in Ukraine within two weeks. He also said he could impose harsh tariffs on India over its purchases of Russian oil.

Over the weekend, US Vice President J.D. Vance said Russia had made “significant concessions” toward a negotiated settlement in the three-and-a-half-year-long war.

Ukraine, which has repeatedly targeted Russian energy infrastructure during the war, launched a drone strike on Sunday that ignited a massive fire at the fuel export terminal in Ust-Luga, according to Russian officials. Another fire broke out at Russia’s Novoshakhtinsk refinery, caused by a Ukrainian drone, and continued for the fourth consecutive day on Sunday, according to the region’s acting governor. The refinery mainly exports fuel and has an annual capacity of 5 million metric tons of oil, equivalent to about 100,000 barrels per day.

Concerns about Russian supply disruptions were tempered by OPEC+ rolling back a series of production cuts, adding millions of barrels to the market, according to Saxo Bank. Eight members of the oil exporters’ group are scheduled to meet on September 7, where they will agree on a further increase in output.

Risk appetite also improved after Federal Reserve Chairman Jerome Powell signaled on Friday the possibility of a rate cut at the US central bank’s September meeting.

However, Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova, said both Brent and WTI prices appear to lack momentum, adding that markets are becoming more convinced that Trump’s tariffs will hurt economic growth.

The US dollar rose slightly on Monday, but struggled to recover from the sharp drop triggered by dovish shifts (toward rate cuts) announced by Federal Reserve Chairman Jerome Powell, which opened the door to a rate cut in the world’s largest economy next month.

The euro declined by 0.1% to 1.1701 dollars, but remained close to Friday’s peak of 1.174225, its highest level since July 28. Both the British pound and Swiss franc also fell by about 0.1%.

In a highly anticipated speech at the Fed’s annual Jackson Hole symposium on Friday, Powell signaled the possibility of a rate cut at the central bank’s meeting next month, saying labor market risks were increasing while inflation risks remained.

Major brokerages such as Barclays, BNP Paribas, and Deutsche Bank now expect a 25-basis-point cut in September following Powell’s remarks. In contrast, analysts at Bank of America remain committed to their forecast that the Fed will keep rates unchanged next month, though they acknowledged that the risks have shifted toward easing.

They said in a note: “We see a risk that the Fed could make a policy mistake by cutting rates at a time when activity is recovering and inflation is approaching 3%.”

Futures pricing shows traders now assign a 87% probability of a quarter-point rate cut on September 17, up from around 70% before Powell’s speech, according to the CME FedWatch tool.

Among the key data awaited this week is the Personal Consumption Expenditures (PCE) index, the Fed’s preferred inflation gauge, due Friday, along with August jobs data scheduled for release a week later.

In addition to expectations for the Fed’s easing path, the dollar was also pressured by US President Donald Trump’s attacks on Powell and other Fed members, raising concerns over the central bank’s independence. Trump recently criticized board member Lisa Cook, saying Friday that he would fire her if she did not resign over allegations related to mortgages she owns in Michigan and Georgia.

Chinese yuan rebounds

In other markets, the Chinese yuan jumped to its strongest level in a month, supported by dollar weakness. The dollar rose slightly against the Japanese yen to 147.17 after having fallen 1% on Friday.

Bank of Japan Governor Kazuo Ueda said during Jackson Hole on Saturday that wage increases were starting to spread beyond large companies, and were likely to continue accelerating amid tightening labor market conditions.

These remarks bolstered market expectations that the Bank of Japan will resume interest rate hikes soon, after having paused following January’s increase to assess the impact of the aggressive global tariffs imposed by Trump.

Ho Min Lee, chief macro strategist at Lombard Odier, sees the yen strengthening to the low 140s against the dollar over a 12-month horizon, but expects it to remain volatile within a narrow range in the near term. He said: “We assume the next rate hike window for the Bank of Japan will be January next year, not October. The bank is likely to keep real interest rates in negative territory until the end of the year before considering gradual increases thereafter.”

Traders currently estimate about a 50% chance of a Bank of Japan rate hike at the October meeting.

Cryptocurrencies

In digital currency markets, ether fell about 4% on Monday after hitting a record high of 4,955.14 dollars over the weekend. Bitcoin dropped about 1% to 111,702 dollars.