The crypto and stock markets experienced a recovery as the U.S. Senate passed the Biden-McCarthy debt ceiling deal, with President Joe Biden set to sign the deal and address averting debt default and the bipartisanship budget agreement. Consequently, the global crypto market cap increased 1.31% to 1.14 trillion on Friday. Bitcoin price rallied over 2% to hit a 24-hour high of $27,203, while Ethereum price also jumped over 2% to almost $1900.
Market expectations reveal that the US nonfarm payrolls increased by 190,000 jobs in May, far lower than April’s 253,000. Additionally, the unemployment rate is expected to be higher in May, with consensus showing 3.5%. Thursday’s ISM manufacturing data displayed a contraction of manufacturing activity for the fifth consecutive month and a significant easing of price pressures. These macro factors could potentially allow the US Federal Reserve to “skip” an interest rate hike this month – the first exception since maintaining its hawkish approach for over a year. Fed Governor Philip Jefferson and Philadelphia Fed President Patrick Harker suggested this week that the central bank would skip a rate hike in June.
According to the CME FedWatch Tool, there is a 70% probability of the Fed keeping its policy rate unchanged. Fed Chair Jerome Powell also hinted at a potential pause in June. Consequently, the benchmark treasuries and the US dollar dipped on Friday, with the US Dollar Index (DXY) falling below 103.50 from a high of 104.50 this week.
With the US debt ceiling deal and Fed eyeing a skipped rate hike, Bitcoin and Ethereum prices rallied. The global stock market followed suit, boosted by the US debt ceiling deal and Fed pause talks, with all global stock indices expected to close in the green on Friday. Bitcoin’s price was at $27,145, with a 24-hour low and high of $26,574 and $27,203, respectively. Altcoins joined the rise, with Ethereum’s price trading 2% higher at $1,891.
In light of recent events, there are still concerns about cryptocurrencies’ institutional interest. As Mike Novogratz pointed out, crypto has low “institutional excitement” right now. Though the market is experiencing a recovery, risks and volatile market conditions persist.
The presented content includes the personal opinion of the author and is subject to market conditions. Do thorough market research before investing in cryptocurrencies. Neither the author nor the publication holds any responsibility for personal financial loss.
Source: Coingape
