The original cryptocurrency initially fell 7.7% to $11,164 in early morning trade, following a 3.8% slide on Wednesday after Powell's testimony on monetary policy before the U.S. House of Representatives Financial Services Committee.
In his testimony to Congress, Powell pointed to "broad" global weakness that was clouding the US economic outlook amid uncertainty about the fallout from the Trump administration's trade conflict with China and other nations. Shares also rose in Taiwan and Southeast Asia. However, excluding the volatile food and energy prices, core inflation rose 0.3% in June, the biggest increase in 18 months.
The Dow Jones Industrial Average gained 76.71 points, or 0.3%, to 26,860.20.
In his prepared statement, Powell said that since Fed officials met last month, "uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the US economic outlook".
The Russell 2000 index of smaller company stocks added 2.46 points, or 0.2%, to 1,565.05. But that dynamic has not fully kicked in during the current expansion and inflation has been stuck below the Fed's 2% target almost the entire seven years since the Fed settled on that figure, according to a separate measure the Fed prefers.
Magnitude 6.9 Earthquake Strikes West of Broome in Western Australia - USGS
The Roey Hotel employee Cindy said she saw cars moving in the quake . "A few things fell off the walls onto the floors", she said. And more aftershocks are to be expected, Phil Cummins, a geologist at Government's GeoScience Australia, warned.
Powell is due to appear before the Senate Banking Committee on Thursday but his testimony is not expected to have the same sort of impact.
Financial markets took Powell's two days of congressional testimony as a signal that when policymakers next gather in about three weeks, the Fed would cut rates for the first time since the financial crisis. Many investors have put the odds of a rate cut this month at 100%.
The Fed's benchmark rate now stands in a range of 2.25% to 2.5% after the central bank raised rates four times past year.
"It's a precautionary action by the Fed in an environment showing risks to economic growth, but it's not (because of) immediate economic danger", said John Stoltzfus, chief investment strategist at Oppenheimer Asset Management in NY, of the likelihood of interest rate cuts. That step eased fears that Trump would extend punitive tariffs to an additional $300 billion in Chinese goods, in the process inviting retaliation from Beijing on American exports and likely weakening both nations' economies. Expectations for a 50-basis-point cut, which had almost been snuffed out following stronger-than-expected USA employment data on Friday, jumped to 26.6%, according to CME Group's FedWatch tool. On Wednesday, it jumped $2.60 to settle at $60.43 a barrel, the highest level since late May. Overnight, it gained $2.85 to close at $67.01 a barrel.
The dollar bought 108.42 Japanese yen, lower than 108.87 Japanese yen of the previous session. The euro strengthened to $1.1271 from $1.1250.
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