On Wednesday, Bitcoin's price on exchanges reached $85,500 after the consumer price index report came in softer than expected. However, on Thursday, the cryptocurrency is trading just above $83,700 as high Treasury yields put pressure on the market. The persistence of 10-year yields around 5.3% and 30-year yields at 5.62% overshadowed Bitcoin's recent gains. Periodic fluctuations in the stock markets also contributed to the retreat of Bitcoin's growth. Data on the personal consumption expenditures (PCE) index showed that inflation rose by 3.4% in August compared to the previous year and by 3.0% excluding food and energy, which lowered the likelihood of an interest rate hike by the Federal Reserve in October.
“Crypto markets took this as a relief signal, and Bitcoin climbed back above $85,000 when yields fell and investors became more willing to buy riskier assets,”– noted Dan Huss, chief analyst at LVRG Research. However, a sustained decline in yields is a necessary condition for supporting the next rally of Bitcoin and other cryptocurrencies.
Against this backdrop, HYPE and Dogecoin emerged as leading cryptocurrencies with gains of about 3% and nearly 2%, respectively, while Solana fell nearly 1%. Major stock indices also showed positive results; Nasdaq 100 futures rose by 0.8%, and the S&P 500 by 0.4%. The Japanese Nikkei saw a notable increase of 2.7% amid an optimistic forecast from Micron Technology, which supported chipmaker stocks. Thus, despite the temporary recovery in prices, high Treasury yields remain a significant barrier for the cryptocurrency market.
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