Bitcoin experienced a significant surge, reaching $66,000 on Friday, following the release of lower-than-expected inflation data in the United States. This positive economic indicator has boosted investor sentiment and fueled inflows into Bitcoin ETFs.
Number of Factors Played a Role in Recent Bitcoin Rally
The cryptocurrency market has seen a broader uptrend, with Ethereum also gaining momentum. The recent peak of $66,500 for Bitcoin marks its highest level since late July.
Several factors have contributed to BTC’s rise. The Personal Consumption Expenditures Price Index (PCE), a key measure of inflation, declined to 2.2% in August from 2.5% in July. This aligns with the Federal Reserve’s decision to cut interest rates by 50 basis points, indicating a potential easing of monetary policy.
Additionally, Bitcoin ETFs have witnessed substantial inflows, totaling $365 million on Thursday. This marks the highest daily inflow since July 21, with ARK Invest’s 21Shares BTC ETF leading the way.
China’s economic stimulus measures have also played a role in Bitcoin’s appreciation. The People’s Bank of China announced plans to inject 1 trillion yuan into state-owned banks and cut interest rates, aiming to revitalize the slowing economy. This development has positively correlated with Bitcoin’s price.
