- Bitcoin Price dropped sharply below $100,000, reaching its lowest since May.
- October U.S. economic data release delayed due to government shutdown, impacting Federal Reserve interest rate decisions.
- Uncertainty around economic data has reduced market expectations for a December interest rate cut.
- Crypto fear and greed index hit extreme fear levels, signaling increased market caution.
- Goldman Sachs warned of a major decline in U.S. jobs, complicating efforts to predict upcoming Federal Reserve policies.
The price of Bitcoin fell sharply, dropping below $100,000 per bitcoin to a level not seen since May. This decline followed continued struggles to regain momentum after reaching an all-time high in October. The bitcoin price plunged roughly 20%, placing it in bear market territory.
The delayed release of critical U.S. economic reports for October, due to a government shutdown, has created uncertainty for the Federal Reserve’s upcoming interest rate meeting. Cryptocurrencies and investors are closely watching these developments as they may affect policy decisions. The October U.S. consumer price index (CPI) report was expected but remains unavailable amid the data blackout.
Nic Puckrin, crypto analyst and co-founder of The Coin Bureau, stated, “Today was supposed to see the delayed release of the U.S. CPI report from October, but instead it appears the government shutdown has created a black hole in the flow of federal data that may never get repaired.” He added that this lack of data hampers policymakers, making the December rate cut increasingly uncertain. According to the CME’s FedWatch tool, just over half of market participants now expect a rate cut at the Federal Reserve meeting on December 10.
The government shutdown has made it difficult for economists and policymakers to receive critical data. Press secretary Karoline Leavitt said, as reported by CNBC, “The Democrat shutdown made it extraordinarily difficult for economic economists investors and policy makers at the Federal Reserve to receive critical government data.” However, National Economic Council Director Kevin Hassett informed Bloomberg that some October jobs data will be partially released.
Earlier this week, analysts from Goldman Sachs warned that the U.S. may have experienced the largest jobs decline since late 2020, complicating the Federal Reserve’s task ahead of the interest rate meeting. Without clear economic signals, investors could move toward safer assets.
Alex Kuptsikevich, chief market analyst at FxPro, noted that the cryptocurrency fear and greed index dropped to 15, marking its lowest since March 4. He described this decline as an “alarming” sign indicating deep-seated risk aversion in markets. The crypto market has not yet participated in recent rallies seen in precious metals and stock indices, raising concerns about market sentiment moving forward.
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