Bitcoin Treads Water Below $80,000 as Inflation Fears and Rate Hike Loom
Bitcoin's price hovered below $80,000 as markets awaited key US inflation data and weighed the possibility of another Federal Reserve interest-rate increase. The cryptocurrency briefly rose above $82,000 last week but lost momentum after stronger-than-expected US labor data, which raised the odds of further Fed tightening.
The solid jobs report for August showed nonfarm payrolls increased by 162,000, exceeding the market forecast of 55,000, while the unemployment rate held at 4.1%. The rising probability that the Fed will raise its benchmark rate by 25 basis points at its September 16 meeting climbed to about 60%, according to CME FedWatch.
Institutional money has continued to flow into Bitcoin, with US spot exchange-traded funds recording net inflows of $987 million last week, marking a third straight week of inflows. On-chain data also strengthened, with the 30-day rate of change in Bitcoin's realized market capitalization turning positive on August 24 and rising to 0.88% by September 6.