Treasury yields at 5% could limit Bitcoin’s rally
Bitcoin faces a tougher backdrop as Treasury yields climb above 5% and rising rates challenge its rally. See why investors are watching the next move.
Bitcoin is coming off its strongest third quarter since 2017, but analysts say the rally may face a tougher backdrop as US Treasury yields rise above 5%, making safer returns more attractive to investors.
Delphi Digital said Bitcoin’s 43% gain in the third quarter and its recent weekly advances have been supported in part by demand tied to concerns about currency debasement and US fiscal deficits. The asset briefly moved above $87,000 last week before easing lower.
The interestrate outlook may be shifting after weakerthanexpected US jobs data lowered the chance of another Federal Reserve rate hike in October. The Labor Department reported that the economy added 29,000 jobs in September, well below forecasts, while Fed officials signaled they do not need to rush into another increase. Market pricing now suggests a much lower probability of an October hike than it did a week earlier.