Bitcoin remains around the $35,000 mark as weaker US employment data suggest that the Fed will adopt a dovish stance. Bitfinex analysts arrived at this conclusion in Bitfinex.
Analysts noted that, according to the U.S. Bureau of Labor Statistics report, October added 150,000 new jobs, almost half the September figure (297,000).
The jobs data suggest that wage-driven inflationary pressure is likely to ease.
According to CME FedWatch, traders increased the probability of no policy change at the December meeting from 80% ahead of the data release to 90.4%.
Experts noted that investors have started pricing in a potential cut in the key rate by June 2024 (the probability reached 64.6% at the time of writing).
We believe that the Fed will stop raising rates due to tighter financial conditions. The central bank is well prepared for a prolonged pause, giving the economy enough time to deal with the consequences of higher borrowing costs. Rising costs are already restraining investment activity, which will require careful assessment of the latest data, the report notes.
Experts noted that since September 2023 there has been a significant decoupling of Bitcoin from the tech Nasdaq index, with which digital gold has historically shown a strong price correlation. Meanwhile, the measure with traditional precious metals rose to 0.8.
Inflows into cryptocurrency investment products from 28 October to 3 November amounted to $261 million after a record $326 million the previous week.
Earlier, SynFutures co-founder and CEO Rachel Lin predicted that the price of digital gold would rise to $47,000 by the end of November 2023.