Amid fluctuations in the cryptocurrency market and broader economic developments, Bitcoin experienced a notable price dip before stabilizing. While U.S. stocks surged on expectations of rate cuts and President Donald Trump’s trade-related comments, Bitcoin saw mixed reactions. The Federal Reserve Bank of Cleveland President Beth Hammack indicated potential "preemptive" rate reductions based on tariff impacts. Meanwhile, spot Bitcoin ETFs attracted substantial investments despite Bitcoin's relatively stagnant price movement.
On Thursday, Bitcoin initially fell to $91,800 but managed to stabilize around $93,300, according to CoinGecko data. This occurred as U.S. stock markets responded positively to anticipated monetary policy adjustments and trade statements from the White House. Ethereum dropped by 1.8%, trading at approximately $1,760, whereas Solana exhibited slight growth, reaching about $151. Hammack's remarks during an interview with CNBC highlighted the Federal Reserve's readiness to act swiftly regarding interest rates if necessary.
In Wall Street's context, the S&P 500 climbed by 2% and the tech-heavy Nasdaq increased by 2.6%. These indices remain below their levels prior to Trump's announcement of reciprocal tariffs affecting numerous countries. Interestingly, Bitcoin has shown resilience compared to its previous correlation with tech stocks within these indices. Concerns persist among economists about inflationary pressures due to broad tariffs; however, recent Consumer Price Index readings indicate softer trends. Trump referenced declining consumer prices when urging Fed Chair Jerome Powell for rate reductions via his Truth Social platform.
Market sentiment reflects growing anticipation of two rate cuts by July, with traders estimating a 45% likelihood, up from 40% previously, per CME FedWatch. Expectations for stable rates have diminished accordingly. Despite Bitcoin's modest decline, spot Bitcoin ETFs witnessed significant inflows amounting to $1.8 billion over two days, marking the highest such figure since early January. Analyst Valentin Fournier noted that institutional purchases seem balanced against profit-taking and reduced retail engagement.
Additionally, geopolitical tensions persisted as Trump publicly addressed Boeing's dealings with China through another post on Truth Social, suggesting dissatisfaction over unfulfilled aircraft orders. Such developments underscore ongoing complexities influencing both traditional and digital asset markets.