Bitcoin (BTC) has climbed back above $67,000, following the Federal Reserve’s latest Beige Book, which revealed a subdued economic outlook across the U.S. Released on Wednesday, the report suggests a potential case for further interest rate cuts in the coming months.
The Beige Book indicated that nine out of twelve regional banks reported stagnant or slightly weakened economic activity since early September. Manufacturing activity declined in most districts, accompanied by signs of slowing consumer demand.
While inflation appears to be moderating—with selling prices rising only slightly in most areas—employment gains were primarily due to replacement hiring rather than growth. Several districts also reported slower wage increases.
This cautious economic perspective stands in contrast to the unexpectedly robust jobs report from September, creating an opening for further rate cuts by the Fed.
At press time, Bitcoin had rebounded from an overnight low of just under $65,200, trading 1% higher at $67,300. The dollar index (DXY), which had been rallying, has since retreated to 104.30 from a peak of 104.57, according to TradingView data.
ForexLive highlighted that the Beige Book’s findings captured the market’s attention, reinforcing the expectation of a 25 basis point rate cut in November, with a significant chance of another in December. This shift in sentiment has also affected the dollar’s performance across the board.
Several Federal Reserve officials, including Chairman Jerome Powell, cited the pessimistic outlook from the Beige Book as a factor in their decision to cut the benchmark borrowing rate by 50 basis points to a range of 4.75%-5% in September.
Markets are now pricing in an additional 75 basis points of easing by the end of the year, although these expectations have been tempered by the recent positive jobs data and a higher-than-anticipated inflation report for September.
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