WASHINGTON (dpa-AFX) - The relief rally triggered by reports of an end to the legal between Ripple Labs and the Securities and Exchange Commission got a further boost as Fed Chair Jerome Powell downplayed the potential effects of the trade tariffs on inflation. Overall crypto market capitalization is currently at $2.81 trillion, implying an overnight surge of around 3 percent.
The Fed on Wednesday held rates steady as widely expected. The Fed Chair termed the potential effect of trade tariffs on inflation as transitory. The remarks helped ease concerns about the Fed embarking on hawkish action to address concerns about inflation attributed to the trade war.
In the Summary of Economic Projections released simultaneously, the Fed lowered the GDP growth projection for 2025 to 1.7 percent from the 2.1 percent it made in December. The GDP growth in 2026 and beyond is now expected to 1.8 percent. In the projections made a quarter ago, the Fed had projected a GDP growth of 2 percent in 2026, 1.9 percent in 2027 and 1.8 percent in the longer run.
The unemployment rate for 2025 which the Fed had projected to be 4.3 percent in December is now seen rising to 4.4 percent. For 2026 and beyond, the Fed does not anticipate any deviations from the projections it had made in December.
In 2025, the PCE inflation as well as its core component are both seen higher than the 2.5 percent the Fed had projected in December. The Fed now expects PCE inflation to be 2.7 percent and core PCE inflation to be 2.8 percent in 2025.
The Fed however expects the spike in inflation to be short-lived. The Fed's projection for PCE inflation in 2026 is at 2.2 percent, a tad higher than the 2.1 percent it had anticipated a quarter ago. Projections for PCE inflation in 2027 and beyond have been retained at 2 percent. The Fed has also not revised the core PCE projections for periods beyond 2025.
Given the anticipated transitory effect on inflation, the Fed has also not altered its projection of the policy path. Aligning with the Fed's projections made in December, the median federal funds rate of 4.4 percent is expected to reduce by 50 basis points each in 2025 and 2026 and by 25 basis points in 2027. Accordingly, the federal funds rate is projected to be 3.9 percent in 2025, 3.4 percent in 2026, 3.1 percent in 2027 and 3 percent in the longer run.
Despite the absence of any significant dovish shift in the Fed's actions or guidance, crypto markets are trading firm as the euphoria of a favorable regulatory environment and the status quo on monetary policy outlook provided major support.
Among the top 100 cryptocurrencies, around 20 are trading with overnight gains of more than a percent whereas around 30 are trading with overnight losses of more than a percent. 3rd ranked XRP tops overnight gains with a surge of more than 7 percent. 94th ranked Curve DAO Token tops overnight losses with a decline of close to 6 percent.
Bitcoin (BTC) that dominates 60.7 percent of the overall crypto market gained 1.9 percent in the past 24 hours to trade at $85,194.32. It is currently trading 22 percent below the all-time-high at $109,114.88 recorded on January 20. The original cryptocurrency traded between $87,443.27 and $83,362.94 during the past 24 hours. Amidst weekly gains of 2.7 percent, the leading cryptocurrency is trading with losses of 10.9 percent over the 30-day horizon and 8.8 percent on a year-to-date basis.
Ethereum has shed 0.45 percent overnight to trade at $1,984.84. The leading alternate coin has recorded gains of 4.7 percent over the past 7 days, losses of 26.3 percent over the past 30 days and an erosion of 40.4 percent till date in 2025. Ether's current trading price is 59 percent below its all-time-high. The most valued alternate coin that dominates 8.65 percent of the overall crypto market ranged between $2,068.76 and $1,938.53 in the past 24 hours.
3rd ranked XRP (XRP) gained 7.01 percent overnight to trade at $2.47, around 36 percent below the all-time high touched in January 2018. The cryptocurrency has however surged close to 19 percent till date in 2025.
5th ranked BNB (BNB) added 3.1 percent overnight at its current trading price of $635.10. BNB is currently trading 20 percent below the all-time high touched on December 4, 2024. Amidst losses of close to 3 percent over the 30-day horizon, the cryptocurrency has lost more than 9 percent till date in 2025.
The price of 6th ranked Solana (SOL) gained 3 percent overnight. With weekly gains of 3.3 percent, SOL is currently trading at $130.73, around 56 percent below its record high on November 23, 2024.
8th ranked Dogecoin (DOGE) added 1.7 percent overnight to trade at $0.1714. Having lost more than 45 percent till date in 2025, DOGE is trading 77 percent below the previous peak scaled in May 2021.
9th ranked Cardano (ADA) added 0.96 percent overnight but is grappling with losses of 0.13 percent in the past week to trade at $0.7245. ADA is currently trading 77 percent below the record high touched in September 2021.
10th ranked TRON (TRX) edged down 0.20 percent overnight to trade at $0.2294. TRX has gained almost 2 percent in the past week. The trading price is 48 percent below the cryptocurrency's all-time high recorded on December 4, 2024.
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