Bitcoin (BTC) News Today: Fed Rate Outlook Weighs on BTC Amid ETF Flows

Bitcoin (BTC) News Today: Fed Rate Outlook Weighs on BTC Amid ETF Flows

On Friday, the BTC-spot ETF market saw net inflows of $338.2 million (excluding Grayscale Bitcoin Trust (GBTC) outflows). Net inflows (excluding GBTC outflows) fell from $389.8 million on Thursday (Mar 14) and $960.2 million on Wednesday (Mar 13).

A larger-than-expected rise in US producer prices (Thurs) impacted bets on an H1 2024 Fed rate cut. US producer prices rose by 1.6% year-on-year. In Jan, US producer prices increased by 1.0%. Economists forecast a 1.1% increase in producer prices. The numbers followed the US CPI Report (Tues), which signaled a sticky inflation environment.

According to the CME FedWatch Tool, the probability of a 25-basis point May Fed rate cut fell from 23.2% to 6.4% in the week ending Mar 15. The chances of the Fed leaving interest rates at 5.50% in June jumped from 26.6% to 41.2%.

The shift in sentiment toward the Fed rate path and impact on BTC-spot ETF market net inflows sent BTC to a Saturday low of $64,909.

Nonetheless, total weekly net inflows for the week ending Mar 15 reached a record high of $2,565.7 million, up from the previous high of $2,271 million in the week ending Feb 16. The weekly data, including GBTC outflows, could offer price support on Sunday as investors consider the week ahead.

US Federal Reserve Interest Rate Decision Looms

Looking ahead, the Fed will deliver the March interest rate decision on Wednesday (Mar 20). Investors expect the Fed to leave interest rates at 5.50%. However, forward guidance could influence near-term BTC price trends.

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About the Author: Daniel