Weekly Wire | BTC Below 70k amid Fed's Forecasted Cut
This Week's Market News
BTC remains just below the 70k mark as markets anticipate several catalysts in the coming weeks. Bitcoin ETF flows recorded over $998 million of inflows for the week ending October 25th, primarily into BlackRock’s IBIT.
We are currently in a wait-and-see mode ahead of the US elections, the November FOMC meeting, and a big week for tech earnings. According to the CME FedWatch Tool, there is a 97% probability of a 25 basis points (bps) cut at the November 7th FOMC meeting. This comes after the Fed’s initiation of the easing cycle with a larger 50 bps cut in September. However, the path of future cuts is uncertain due to stronger-than-expected US economic data.
The last month of trading has been marked by a reassessment of Fed rate cut expectations, leading to a rise in the US yield curve. The 10-year US Treasury yields are up ~65 bps since September lows, shifting the narrative to US economic outperformance.
A recent example of this dynamic is seen in Canada. Last week, the Bank of Canada slashed rates by 50 bps to 3.75%, following a series of three 25 bps cuts since June. The diverging paths of US and Canadian interest rates, alongside slower growth expectations for Canada, have put pressure on the Loonie. This narrative has also contributed to the DXY rising more than 4% in October.
Tether CEO Paolo Ardoino was spotted by the CoinFlip team at Lugano’s Plan ₿ Forum on Friday, coinciding with a Wall Street Journal exclusive that federal prosecutors are investigating Tether for potential violations of anti-money-laundering and sanctions rules. Ardoino denied the reports, saying there was "no indication" of an investigation and that the WSJ report was “regurgitating old noise”.
In corporate news, Microsoft will evaluate Bitcoin as a corporate reserve asset at its annual meeting on December 10th. If approved, Microsoft would become the largest public company with reserves in BTC.
Notable Crypto News
Tether CEO says he sees no indication of US probe | Reuters
Base one-day stablecoin transfer volume outranks all other chains for first time | The Block
Vitalik Buterin outlines ways to reduce Ethereum's bloat in 'Purge' upgrade roadmap | The Block
US government retrieves over $19 million from purported hack this week: Arkham | The Block
The Macro Week Ahead
European GDP and inflation numbers hit the wires this week. Friday’s US Non-Farm Payrolls could be heavily impacted due to hurricanes Helene and Milton.
In the equity space, it’s a big week for tech earnings with Alphabet reporting Tuesday, Microsoft and Meta Wednesday, and Apple and Amazon reporting on Thursday.
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