Ethereum Corrects Lower as Rate Hike Bets Rise Amid Strong US Labor Market
Ethereum (ETH) corrected lower towards $2,400 on Friday as volatility rises in the broader cryptocurrency market. The largest smart contract token faced rejection after rising to $2,546 earlier, hinting at profit-taking and investors adopting a cautious stance amid macroeconomic uncertainty.
The resilient US labor market has seen traders reassess the probability of the Federal Reserve raising interest rates to the 3.75%-4.00% range, currently sitting at 60%, up from 49% the previous day, according to the FedWatch tool. Tighter monetary policy is likely to weigh on risk assets like Ethereum.
Ethereum's outlook remains grounded in risk-on sentiment, as reflected in the Fear & Greed Index, which sits at 74 in the Greed territory on Friday, up from 65 the previous day. Capital inflows returned on Thursday, with Ethereum spot Exchange-Traded Funds (ETFs) attracting $148 million in deposits.