Bitcoin declined toward $78,000 on Tuesday, extending its retreat from last week’s three-month peak as stronger-than-expected U.S. employment data reinforced expectations that the Federal Reserve could raise interest rates this month. Rising oil prices also heightened concerns over inflation.
The world’s largest cryptocurrency was last down 1.38 percent at $78,419.0 by 11:14 GMT.
Fed rate hike bets weigh on Bitcoin
Bitcoin briefly surpassed $82,000 last week before reversing course after Friday’s U.S. jobs report. The report revealed that U.S. employers added 162,000 jobs in August, nearly three times economists’ forecasts, while the unemployment rate remained steady at 4.1 percent.
The stronger-than-expected figures lifted the market-implied odds of a 25-basis-point Federal Reserve rate hike at its September 16 meeting to about 60 percent, according to CME FedWatch.
Other market-based indicators, however, placed the likelihood closer to the low-50 percent range.
Higher interest rates generally weigh on Bitcoin and other risk-sensitive assets by making yield-generating investments more attractive and tightening financial conditions. Treasury yields have also climbed, with the 10-year US Treasury yield trading around 4.8 percent.
Markets are now turning their attention to U.S. producer price data due Thursday, followed by consumer inflation figures on Friday. The reports will provide the final major inflation readings ahead of the Fed’s upcoming policy meeting.
Read: Bitcoin falls 0.19 percent to $79,604.53 as strong U.S. jobs lift Fed rate-hike bets
Rising oil prices pressure crypto market
Rising oil prices are adding further pressure. Brent crude climbed above $98 a barrel on Tuesday, reaching its highest level in roughly six weeks, as escalating tensions between the U.S. and Iran fueled concerns about potential supply disruptions and shipping through the Strait of Hormuz.
Despite the recent decline, Bitcoin remains well above its recent lows after advancing roughly 25 percent in August. U.S. spot Bitcoin ETFs also attracted around $1 billion in net inflows last week, marking a third consecutive week of positive flows and offering further support to the cryptocurrency market.
Most major altcoins traded within narrow ranges on Tuesday as cautious sentiment kept gains in check.
Ethereum, the world’s second-largest cryptocurrency, fell 0.61 percent to $2,474.04. XRP, the third-largest cryptocurrency by market value, eased 0.43 percent to $1.3933, while Solana slipped nearly 2 percent and Cardano fell 0.91 percent.
Among meme coins, Dogecoin lost 0.37 percent.
