Analysis: Bitcoin Shows Resilience to High Interest Rates, Market May Have Already Priced in Fed Rate Hike Expectations

Odaily reports that the U.S. core CPI rose 0.3% month-over-month in August, exceeding expectations of 0.2%, further reinforcing expectations for a Fed rate hike next week. Analysts believe the market had already priced in ample time for a rate hike, and if the Fed raises rates as expected, the market reaction may be relatively limited. Instead, an unexpected decision to hold rates steady could trigger a larger rally in risk assets. Matt Mena, Senior Crypto Research Strategist at 21Shares, said historical data shows that in the 30 days following a core CPI reading above expectations, Bitcoin rose an average of 2.13%.

Affected by the data, Bitcoin is currently trading at approximately $78,600, up 1.5% over the past 24 hours. Mark Connors, Chief Investment Officer at Risk Dimensions, said that rising U.S. Treasury yields across the board and the simultaneous strengthening of Bitcoin and gold indicate that the market is concerned not only about the Fed's rate path, but also about inflation, government debt, and the credibility of monetary policy. (Cointelegraph)