Bitcoin Price Plunges as DXY Reaches 8-Week High on Rising Rate Hike Bets

Bitcoin's price has dropped by 2.7% to $84,061 on September 24 due to a strengthening US dollar. The US Dollar Index (DXY) surged to an eight-week high of 101.231 on September 23, its highest reading since July 29.

The rising odds that the Federal Reserve will hike interest rates by 25 basis points at the October FOMC meeting has contributed to the dollar's strength. According to CoinGape prediction markets, 65% of traders are betting on a rate hike, which could push US interest rates to 4.00%-4.25%. This hawkish policy may weaken Bitcoin price as higher rates attract investors away from risk assets and into risk-free government bonds.

However, some members of the Trump administration have questioned the Fed's decision to hike rates. Kevin Hassett, Director of the White House National Economic Council, has expressed concerns about the impact of rate hikes on the economy.