Bitcoin News Today: Fed Split and Tariff Jitters Shake Crypto Markets

JPMorgan reported mixed developments in the U.S. labor market amid fluctuating macroeconomic conditions. Federal Reserve policymakers expressed divided opinions during their July meeting, highlighting concerns over inflation and employment. Most officials deemed it premature to cut interest rates, with inflation seen as the greater threat. However, some, including Governors Christopher Waller and Michelle Bowman, advocated for immediate rate cuts. This marked the first time in over three decades that multiple Fed governors dissented on a rate decision [7].

The minutes revealed a broad consensus among participants that the U.S. labor market remained resilient, despite signs of softening. Unemployment rates stayed low, and while job creation in July was weak, earlier months had been revised downward, reinforcing labor market concerns. Officials noted that the job market’s strength could not be taken for granted, and there was a recognition of “considerable uncertainty” surrounding the potential inflationary effects of President Trump’s tariff policies [7].

In parallel, the broader macroeconomic environment appeared to temper investor optimism in digital assets. Bitcoin and ether retreated after a recent rally, with BTC trading around $115,500 and ETH near $4,330. The pullback was attributed to stronger-than-expected inflation data, which reduced expectations for a September rate cut and boosted the U.S. dollar. “Investors are reassessing risk in light of higher inflation readings,” said Vincent Liu, Chief Investment Officer at Kronos Research. “This has temporarily slowed momentum in digital assets” [5].

Market analysts also pointed to the July producer price index, which rose 3.3% year-over-year, as a key factor behind the decline. This shift in macroeconomic expectations led to a reallocation of capital within the crypto space, with spot ETFs experiencing significant outflows. Bitcoin and ether ETFs saw combined outflows of $945 million in a single day, with Fidelity and Grayscale leading the redemptions. These movements suggest institutional de-risking in anticipation of macroeconomic events such as the Federal Reserve’s Jackson Hole symposium and the release of U.S. jobless claims data [3].

Looking ahead, the U.S. economic calendar is packed with critical data releases and policy decisions. The coming week will feature the release of the Federal Reserve’s July meeting minutes, flash PMI data from the eurozone, and the U.S. jobless claims report. The focus will remain on whether inflation remains a pressing concern and whether the labor market continues to show signs of strain. These developments are likely to influence the direction of interest rate policy and, by extension, the performance of both traditional and digital asset markets [4].

Source: [1] Market Update: Bitcoin and Ether Retreat After Recent Rally (https://www.unlock-bc.com/147229/market-update-bitcoin-and-ether-retreat-after-recent-rally) [2] TA Tuesday: BTC Pullback, ETH Momentum (https://www.crypto-finance.com/ta-tuesday-btc-pullback-eth-momentum) [3] Bitcoin and ETH bounce after heavy ETF outflows, Bitwise ... (https://www.theblock.co/post/367707/the-daily-bitcoin-and-eth-bounce-after-heavy-etf-outflows-bitwise-sees-btc-beating-traditional-assets-the-sec-chair-calls-most-crypto-tokens-non-securities-and-more) [4] Fed Officials Split on Rates as Labor Market Shows Strain (https://www.europeanfinancialreview.com/fed-officials-split-on-rates-as-labor-market-shows-strain/) [5] TA Tuesday: BTC Pullback, ETH Momentum (https://www.crypto-finance.com/ta-tuesday-btc-pullback-eth-momentum) [6] Bitcoin Ignores US-EU Trade Deal With $114K In Focus (https://cointelegraph.com/news/bitcoin-price-dip-hinges-on-114k-as-markets-shrug-off-us-eu-trade-deal) [7] Fed Officials Split on Rates as Labor Market Shows Strain (https://www.europeanfinancialreview.com/fed-officials-split-on-rates-as-labor-market-shows-strain/)