The price of Bitcoin (BTC) has firmed up in recent trading sessions and is hovering near $115,000 U.S. as markets brace for an interest rate cut from the U.S. Federal Reserve.
Bitcoin, the largest cryptocurrency by market capitalization, is trading just above $116,000 U.S. hours before the U.S. central bank is expected to deliver its first rate cut of the year.
Futures traders have priced in a 100% chance that the Federal Reserve will lower interest rates by 25-basis points as signs point to a slowdown in the American economy and labour market.
Lower interest rates are likely to increase investors’ appetite for risk assets such as cryptocurrencies, sending the price of Bitcoin higher in recent days.
After peaking at an all-time high of just over $124,000 U.S. in mid-August, Bitcoin’s price had slumped and fallen below $110,000 U.S. to start September.
However, BTC has inched higher in recent days as expectations for an interest rate cut from the Fed grew more pronounced.
Bitcoin trades around the clock: 24 hours a day, seven days a week. It is not the only digital asset to rise leading into the U.S. central bank’s latest decision on interest rates.
Other cryptocurrencies such as Ethereum (ETH) and Dogecoin (DOGE) have also moved higher on expectations for interest rate cuts.
Bitcoin is currently up 25% on the year versus a 13% gain in the benchmark S&P 500 stock index.
