Bitcoin Price Steady at $62K Amid Fed and Inflation Focus
On Wednesday, Bitcoin traded relatively stable after a recent dip as traders waited for more signals from the Federal Reserve regarding U.S. interest rates and inflation data. This week, the world’s largest cryptocurrency struggled to rebound under the pressure of a strengthening U.S. dollar and a decline in risk appetite in broader financial markets.
As of 01:50 ET (05:50 GMT), the price of Bitcoin stands down at 0.1% at $62,466.2 as market participants look for further cues in the future course of the US interest rate from Fed minutes released later in the day.
September saw the first-interest rate cuts from the Fed, 50 basis points mark the starting point of an easing cycle. Yet, last week’s great payroll data brings one to speculation about how aggressively the Fed continues further slashing rates.
That rise had traders increasingly taking into account the prospects of a slower pace of rate cuts. The chance of a 25-basis point cut in November was given an 84.1% probability, while there was a 15.9% chance that rates would remain unchanged, according to CME’s Fedwatch tool.
Thursday had the market waiting on consumer price index (CPI) inflation data, likely to factor into the Fed’s next moves. To that end, the Fed said that it will guide future cuts by both inflation and labor market conditions, so both metrics will significantly influence the pace of rate cuts going forward.
Lower interest rate environments are generally positive for speculative assets, including cryptocurrencies. However, a more measured pace of rate reductions may keep traders hesitant, as higher U.S. rates tend to suppress appetite for riskier investments, such as Bitcoin.
Crypto and Broader Markets: Limited Movement
While overnight the U.S. stocks recovered somewhat, Bitcoin and broader crypto markets largely missed out on this. Specifically, Bitcoin was stuck inside a $50,000 to $65,000 trading range that has prevailed since June, with periods of extreme price volatility.
Clear catalysts that investors will look for the coming days in driving prices higher are next in line, such as Bitcoin. One of these is that resumption of options trading on a spot Bitcoin ETF recently launched by BlackRock, which may once again attract more interest into Bitcoin.
Despite some recent setbacks, including a growing risk aversion resulting from concerns that the Israel-Hamas conflict could be heating up into a new level of intensity, there are some macro factors that can well support crypto markets.
Those include Donald Trump winning the 2024 U.S. presidential election. Trump has been an advocate of crypto in his efforts at campaigning of late, and that bodes well for the industry. As reported by betting platform Polymarket, Trump already leads Vice President Kamala Harris by a 53.4% to 45.9% margin.
Altcoins: Minor Pullback as Bitcoin Steps Back
Bitcoin went largely flat, but it seemed some minor pullbacks were occurring among the altcoins. Ether climbed 0.9% to $2,450.46. Other top altcoins are SOL, XRP, ADA, and MATIC; meme token DOGE gained 1.2%.
However, while the price of Bitcoin continues to hold into the region of $62,000, there is close observation happening in the cryptocurrency markets as US economic data is awaited, along with decisions by the Federal Reserve, whose outcome may decide which direction near-term BTC action takes: both upward and downward.
