Bitcoin gains as rate hike expectations ease after soft PCE data

Bitcoin got a macro-flavored lift on September 30, briefly touching $85,598 as traders sharply reduced their bets on another Federal Reserve rate hike in October. What moved the market The main trigger was August’s Personal Consumption Expenditures data, the Fed’s preferred inflation gauge. Core PCE, which strips out volatile food and energy prices, rose 3.0% year-over-year. Forecasters had expected 3.3%. Headline PCE came in at 3.4%, against predictions of 3.7%. The data landed on top of comments from NY Fed President John Williams on September 29. He said there was “no need for urgency” on future rate increases. Put together, the two signals caused a sharp repricing. Odds of a Fed hike fell from above 70% to around 37% on September 30. A September that broke the pattern Bitcoin had spent much of the month trading between $83,000 and $84,000. Bitcoin closed September with a 7% gain. This marks its first positive September following a positive August since 2013. Bitcoin’s third-quarter return exceeded 40%. That gain came despite Treasury yields sitting above 5.2%, which gives investors a meaningful return for simply holding government debt. The ETF bid keeps showing up Spot Bitcoin...