Bitcoin Price Hits $60K, Here’s Why BTC Is Rising Today

Bitcoin (BTC) price briefly reclaimed the $60,000 mark today, reflecting renewed bullish sentiment in the cryptocurrency market. Several macroeconomic and market-specific factors have contributed to this surge, offering a glimpse of optimism for investors. Moreover, the bets on a Federal Reserve rate cut of 50 basis points have risen.

Bitcoin Price Reclaims $60K

One of the key drivers of the Bitcoin price surge is the latest U.S. economic data, specifically the Producer Price Index (PPI) data. The PPI, which measures the costs producers receive for final demand goods and services, showed a 0.3% increase in August, slightly exceeding the 0.2% consensus estimate.

Excluding food and energy, the core PPI also increased by 0.3%, signaling persistent inflationary pressures in the economy. On a year-over-year basis, the headline PPI saw a 1.7% rise. Whilst, the annual core PPI, excluding food, energy, and trade, reached 3.3%.

Fed Rate Cut Odds

Chris Larkin, managing director of trading and investing for E-Trade at asset manager Morgan Stanley, emphasized the PPI’s alignment with the CPI. He also believes that the recent jobless claims data clears the way for the Federal Reserve to begin a rate-cutting cycle.

Markets are already pricing in a potential 0.50% rate cut with Bitcoin price taking advantage. Now, the attention is shifting to how aggressively the Fed will reduce rates over time. Larkin highlighted that discussions would soon focus on the pace and depth of rate cuts, which could play a significant role in shaping the market’s trajectory.

Additionally, analysts from Citi have predicted a 1.25% rate cut by the Fed in 2024. They expect this move to coincide with cooling inflation, particularly in core Personal Consumption Expenditures (PCE), and improving labor market conditions. If inflation continues to slow and borrowing costs decrease, this could fuel a resurgence in economic activity, providing a favorable backdrop for risk-on assets like Bitcoin.

BTC and other cryptocurrencies tend to benefit from a low-interest-rate environment. As inflation cools and borrowing becomes cheaper, investors often turn to assets like Bitcoin to hedge against inflation and take advantage of potentially higher returns. Also, the Bitcoin price prediction by analyst Ali Martinez suggests that BTC is set to $64,300 as it surpassed the $59,885 level.

Institutional BTC Buying Soars

In addition to macroeconomic factors, institutional interest in Bitcoin has surged. MicroStrategy, led by Executive Chairman Michael Saylor, revealed on the X platform that the company has expanded its Bitcoin holdings by purchasing an additional 18,300 BTC worth $1.11 billion.

This move cements MicroStrategy’s position as the largest corporate holder of Bitcoin. Similarly, Marathon Digital Holdings, a prominent player in the Bitcoin mining sector, added over 5,000 BTC to its holdings in the past month. This brings its total to 26,200 BTC, valued at approximately $1.5 billion.

Moreover, the crypto market has seen a rebound in Spot Bitcoin ETF inflows. These ETFs recorded $140.7 million in inflows so far this week, recovering from the outflows of the previous week. This positive sentiment is expected to push Bitcoin price higher. Moreover, Ric Edelman, the founder of The Digital Assets Council of Financial Professionals, set the BTC price target at $420,000.

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Kelvin Munene Murithi

Kelvin is a distinguished writer with expertise in crypto and finance, holding a Bachelor’s degree in Actuarial Science. Known for his incisive analysis and insightful content, he possesses a strong command of English and excels in conducting thorough research and delivering timely cryptocurrency market updates.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

Source: https://coingape.com/bitcoin-price-hits-60k-heres-why-btc-is-rising-today/