Bitcoin climbed back above $77,000 after New York Fed President John Williams said the recent jump in Treasury yields reflects a strong economy rather than inflation risk. He took a wait-and-see stance on a September rate hike, even as traders still price roughly two-in-three odds of one. Bitcoin futures open interest rose alongside the price move.
Williams ties yields to a strong economy
New York Fed President John Williams said Wednesday that the recent surge in Treasury yields is the product of a strong economy, not market dysfunction. He told CNBC's Steve Liesman during a Squawk Box interview from the New York Fed's Manhattan headquarters that heavy investment in AI, data centers and technology is driving the strength.
According to CNBC: "I think that we have to wait and see," Williams said when asked whether a rate hike is necessary. He added that he sees inflation expectations as well anchored despite this year's price run-up tied to tariffs and the Iran war.
His remarks followed Fed Chair Kevin Warsh's hawkish Jackson Hole comments on inflation, which had pushed rate-hike odds higher. Separately, Williams also sounded more open to an interest-rate increase in a television appearance Wednesday, a shift for a policymaker who has led the central bank's hold-and-wait strategy on rates, with Fed watchers now watching the upcoming jobs report and inflation data as key.
Rate-hike odds hold near two in three
Traders still assign roughly a 66% probability to a 25bps rate hike at the September FOMC meeting, according to CME FedWatch data. The 10-year Treasury yield hovered near 4.78% after Williams' comments, pulling back from session highs near 4.81%. The US dollar index traded around 99.55, easing from earlier levels as Williams denied urgency for a hike.
Bitcoin reclaims $77,000
Bitcoin jumped 1% in an hour to trade above $77,200, with a 24-hour range between $76,297 and $78,137. Bitcoin futures open interest climbed 1% to $53.74 billion over four hours, with CME open interest up more than 0.20% while Binance open interest fell 0.14%.
Traders now await US jobs data, inflation data and the September FOMC decision for clearer direction on Bitcoin's price.
Sources: CoinGape, CNBC, MarketWatch (snippet-based)
Trading involves risk.
Risk Disclaimer
