Bitcoin Tumbles Below $83,000 as Fed Rate Hikes Loom
The price of Bitcoin has plummeted below $83,000 as investors reassess their expectations for future Federal Reserve interest rate hikes. According to CME FedWatch data, four quarter-point increases are expected by June 2027, raising rates from the current range of 3.75%-4% to 4.75%-5%. This has triggered a rise in US Treasury yields, with the 20-year yield approaching 5.5% and the 10-year yield hovering above 5.1%. The strengthening dollar index, up 3% year-to-date and now above 101, is putting pressure on risky assets like Bitcoin and gold.
Gold prices are also falling, currently trading around $4,200 per ounce, as investors seek safe-haven assets amidst rising interest rates and bond yields. Economic growth, inflation risk, and increasing capital demand continue to drive up bond yields, with tensions in the Middle East and heavy borrowing for AI infrastructure adding to the pressure.