Bitcoin News Today: Bitcoin Climbs Toward $116,000 as Fed Rate Cut Odds Jump to 82.1%

Bitcoin edged closer to $116,000 on August 1, 2025, as market participants speculated on the possibility of a Federal Reserve rate cut in response to weaker-than-expected July nonfarm payrolls data [1]. The jobs report, released on the same day, showed a mere 73,000 new jobs added, significantly below the forecast of 147,000. This prompted a sharp upward revision in the probability of a September rate cut, which now stands at 82.1%, compared to 39.2% the previous day [1]. The shift has fueled optimism in risk assets, including Bitcoin, as investors anticipate increased liquidity from a more accommodative monetary policy [1].

The data also led to a depreciation in the U.S. dollar, which in turn supported the appeal of alternative assets such as Bitcoin and gold [3]. Gold prices reached a one-month high amid the weaker dollar and declining Treasury yields. Analysts have highlighted that a dovish Fed could further reinforce Bitcoin’s upward trajectory, especially if inflationary pressures continue to ease and the labor market shows more signs of slowing down [1].

Despite Bitcoin’s rally, it has faced resistance near the $116,000 level in recent sessions. However, the broader market environment remains risk-on, with top altcoins also showing signs of recovery following recent Fed warnings [2]. This suggests that market participants are beginning to adjust to the evolving policy expectations. Yet, uncertainty remains as the Fed’s path forward is still unclear and will depend on upcoming economic indicators.

The U.S. labor market has shown signs of cooling, as evidenced by the downward revisions to May and June payroll figures [1]. While the unemployment rate held steady at 4.2%, consistent with forecasts, the downward revisions raise concerns about the strength of the labor market. This has led to increased speculation that the Fed will begin to ease policy, with September appearing as a likely candidate for the first rate cut of the year.

Political developments have added another layer of complexity to the market outlook. Recent executive orders introducing reciprocal tariffs have raised inflationary concerns and disrupted investor sentiment [1]. These trade tensions contributed to a temporary decline in Bitcoin and other cryptocurrencies earlier in the week. Donald Trump publicly urged the Fed to cut interest rates, citing the impact of tariffs on the U.S. Treasury and criticizing Fed Chair Jerome Powell. This highlights the growing pressure on the central bank to balance inflation control with the need to support a weakening labor market.

A potential rate cut in September would mark the first reduction in 2025 after several months of unchanged policy. Such a move is expected to inject liquidity into financial markets, potentially supporting Bitcoin’s recovery and broader asset prices [1]. Historically, a dovish shift in monetary policy has favored risk assets, and traders are increasingly pricing in this outcome.

Investors are advised to remain cautious as the market continues to navigate mixed signals. While the case for a rate cut has strengthened, the Fed’s response will ultimately depend on the evolution of key economic indicators. The coming weeks will be critical in determining whether the central bank will follow through with a rate cut and how markets will react.

Sources:

[1] title: Bitcoin Rejects at $116K Despite US Jobs Win as Fed Rate ...

(url: https://m.fastbull.com/news-detail/bitcoin-rejects-at-116k-despite-us-jobs-win-4338015_0)

[2] title: Top Altcoins Recover after Fed Warnings, Showing Market ...

(url: https://www.mitrade.com/insights/news/live-news/article-3-1002491-20250731)

[3] title: Fed keeps interest rates steady - The Economic Times

(url: https://economictimes.indiatimes.com/topic/fed-keeps-interest-rates-steady)