The price of Bitcoin (BTC) could be under pressure due to the accelerating job market in the country’s largest economy.
The price of Bitcoin (BTC) could come under pressure due to the accelerating job market in the world’s largest economy, the United States.
The nonfarm employment report, released June 7, measures changes in the number of people employed over the previous month, excluding the agricultural sector.
With the U.S. nonfarm payrolls report beating expectations, investors may be concerned about further tightening of monetary policy.
This could lead to Bitcoin (BTC) closing weekly below the $70,000 mark due to investors’ diminishing appetite for risky assets, according to Bitfinex analysts:
“If the nonfarm payrolls report significantly exceeds expectations, it could indicate a stronger economy, which could raise fears of a tightening of monetary policy. This could put downward pressure on Bitcoin as investors rebalance toward the traditional asset.
However, non-farm job creation was stronger than expected, with more than 272,000 new jobs, surpassing the previous estimate of 182,000 jobs.
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An interest rate cut by the European Central Bank could increase the price of Bitcoin
Among other important macroeconomic developments, the European Union became the second major economy to cut interest rates this week, after Canada.
The European Central Bank has reduced its key rate from 4% to 3.75%, in the run-up to the elections which will be held at the level of the European Union. This is the first interest rate cut by the central bank in five years.
The move could add more liquidity to Bitcoin, according to analysts at Bitfinex, who wrote:
“A fall in interest rates could weaken the euro, which could lead to increased demand for alternative assets such as Bitcoin. The increased liquidity resulting from this monetary easing could also support risky assets, notably cryptocurrencies.
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Can ETF Flows Push Bitcoin Above $70,000 Weekly Close?
Bitcoin was trading essentially flat on the daily chart, but fell 0.8% in the hour to 1:00 p.m. UTC, to trade at $71,186, according to CoinMarketCap data.
Positive institutional flows from the United States into Bitcoin exchange-traded funds (ETFs) could help BTC close the week above the crucial $70,000 level.
So far this week, US Bitcoin ETFs have accumulated over $1.54 billion in cumulative net inflows. Based on current inflows, ETFs are expected to collect 3.74% of the bitcoin supply each year, according to Dionne data.
US Bitcoin ETFs saw collective inflows of $488.1 million on June 5. ETFs recorded their second best day of entry with $886.6 million on June 4.
On February 15, Bitcoin ETFs accounted for about 75% of new investments in the world’s largest cryptocurrency as it crossed the $50,000 mark.
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