Bitcoin Regains $70k as PCE Index Signals Potential Rate Cut

• The PCE index increased by 0.2% in September, matching predictions.
• This aligns with the Fed’s annual inflation target and may lead to another interest rate cut on November 7th.
• Bitcoin dipped below $70K but quickly regained, trading at $70,145 as speculation of a rate cut grows.

A new report from the U.S. Commerce Department shows that personal consumption expenditures (PCE) in September increased by 0.2% when compared to August’s results. Market experts responsible for analyzing inflationary effects on consumer products had already predicted the precise rise of 0.2%.

The PCE index is a report that shows how inflation is affecting the prices of everyday products like food, and clothes. This indicator is seen as a key indicator of how the American inflation rate is affecting consumers and is likely to have a significant say on the upcoming FED decision to lower interest rates on November 7th.

Although prices increased, the predictable amount of 0.2% after one month falls in line with the Federal Reserve’s yearly 2% inflation target. Since January, PCE costs have grown by 2.1%, a half-step over the FED’s intended goal.

For this reason, many speculate that the upcoming FOMC meeting on November 6-7 will feature yet another interest rate cut of at least 0.25%. In the last summit, the FED decided to slash interest rates by 0.5% – the first cut since 2020. 

Bitcoin Falls Below $70k

Bitcoin and most of the crypto market had little reason to celebrate. On October 31st, BTC fell below the $70,000 margin, reaching as low as $69,300 during the afternoon. 

However, as the idea that a new interest cut could happen only 7 days from now, the market is already seeing a small resurgence. Bitcoin has just regained the $70k zone – currently trading at $70,145 as per CoinMarketCap. 

Since its lowest intraday point, the largest crypto has gained 0.83% in value and could attempt to reclimb back to the $72,000 zone it had this morning.

Investors are now bracing themselves for one of the most important weeks of the year. On top of the volatility that speculations regarding U.S. interest rates have on the market, on November 5th America will also decide its 48th President in an election heavily influenced by crypto.