The price of bitcoin (BTC) fell sharply in recent hours, reaching $101,680 at the time of this publication.
Bitcoin’s fall occurs after the market reduced its expectations about an interest rate cut by the United States Federal Reserve (FED) in December, which has put downward pressure on the digital currency.
The following TradingView graph shows the decline in BTC this Wednesday, November 12:
Until a week ago, most analysts expected that the FED would continue its monetary easing cycle with a new 25 basis point cut in December. However, the odds have changed significantly.
According to the CME FedWatch, market bets grant now a 65.4% probability that the target rate will be between 3.50% and 3.75%, compared to 34.6% that expects to maintain the current range of 3.75%–4.00%.
Along the same lines, Polymarket prediction markets reflect a 71% probability of a cut, but with a notable increase in “no change” expectations, which now total 27%.
According to reported The Wall Street Journal, within the FED there is an internal division over whether the main risk is persistent inflation or a labor slowdown.
This is due to the closure of the US government, which, although its lifting seems imminent, interrupted the publication of key macroeconomic data and has deepened that uncertainty, as reported by CriptoNoticias.
The lack of clarity about the monetary direction has increased volatility in the markets, and bitcoin has been no exception.