Market News

BY  Brian McGleenon

Bitcoin's (BTC-USD) price saw a modest increase of 1% on Thursday, to trade around $83,700 (£64,597). This uptick comes amid easing US inflation rates and renewed interest from institutional investors in spot bitcoin exchange-traded funds (ETFs).

However, the gains come against a backdrop of escalating global trade tensions, with US president Dobald Trump’s new tariff policies adding uncertainty to the broader economic outlook.

In early trading on Thursday, Bitcoin (BTC-USD) was holding firm at $83,700 (£64,697), with intraday swings between a low of $80,625 and a high of $84,302, according to CoinGecko data.

Easing US CPI inflation gives bitcoin a modest boost

In February, the US Consumer Price Index (CPI) for both headline and core inflation rose by 0.2%, coming in slightly below Wall Street expectations and the previous month’s figures. This lower-than-expected inflation print has eased concerns among consumers and businesses already bracing for the potential inflationary effects of new tariffs.

It has also strengthened market expectations that the Federal Reserve may cut interest rates sooner than previously anticipated. Monetary easing tends to benefit risk assets like bitcoin by increasing liquidity in the financial system and making fixed-income investments less attractive to investors.

BRN analyst Valentin Fournier said: “This lower-than-expected inflation print strengthens the case for multiple rate cuts, as investors now price in an 82% chance of three cuts by December — a major potential liquidity boost for risk assets, including crypto.”

In addition, for the first time in over a week, spot bitcoin exchange-traded funds (ETFs) saw a net positive flow day — bitcoin saw inflows of $13m that helped offset Ethereum’s (ETH-USD) $10m outflows.

This suggests that, while institutional participation remains cautious, longer-term trends are steering flows rather than immediate market sentiment.

Read more: What Trump's planned banking deregulation means for investors

"Digital assets responded positively to the cooling inflation data and rising odds of rate cuts," Fournier said. "Positive macro catalysts are aligning, including incoming liquidity from Germany and China and the Fed potentially cutting rates earlier than expected, the market appears poised for gradual upside momentum."

Trump tariffs weigh on world markets

These bullish indicators come even as concerns mount over the broader macroeconomic environment. Trump’s recent imposition of tariffs on imports from the EU, Canada, Mexico and China.

The EU, Canada and China announced retaliatory measures amid fears that the US president's global trade war could further stoke inflation and impact economic output.

Market participants will be watching closely as the Federal Reserve weighs its next moves amid these pressures. The next Federal Open Market Committee (FOMC) meeting is scheduled for 18-19 March during which the Fed will announce its latest interest rate decision.