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Read expert analysis on what could drive XRP to new highs here.
Bitcoin Retakes $90K as US Data Keeps June Fed Rate Cut Hopes Alive
On March 5, the US ISM Services PMI eased recession fears, rising from 52.8 in January to 53.5 in February. Firms increased staffing levels on higher demand, with prices also rising, potentially tempering bets on a June Fed rate cut.
In contrast, the ADP jobs report showed a 77k increase in February, well below January’s 186k surge, suggesting a cooling labor market. A weaker job market may affect wage growth, dampening consumer spending and demand-driven inflationary pressures.
Bitcoin briefly dipped below $88K after the ADP report but rebounded to $90K as PMI data reassured investors.
Fed Rate Outlook: The contrasting reports left market bets on an H1 2025 Fed rate move relatively steady. According to the CME FedWatch Tool, the probability of a June Fed cut fell from 81.1% on March 4 to 78.4% on March 5. Fed rate cuts could lower borrowing costs, increasing demand for risk assets, including bitcoin (BTC).
President Trump Offers Tariff Relief
Meanwhile, President Trump exempted certain automakers from the recent tariff hikes on Canada and Mexico. The exemption will reportedly be effective for one month, with Trump also receptive to exempting other goods from tariffs.
A softened tariff stance could help stabilize inflation and support a more dovish Fed policy, reducing uncertainty for risk assets.
Bitcoin Price Scenarios: Key Levels to Watch
On March 5, BTC rose 3.82%, adding to Tuesday’s 1.28% gain, closing at $90,639. Meanwhile, investor focus will return to the US economic calendar and tariff developments on Thursday, March 6.
- US Jobless Claims: Economists forecast initial jobless claims to fall from 242k (week ending February 22) to 235k (week ending March 1), influencing the Fed rate path.
- Tariff Developments: Rollbacks could drive demand for risk assets.
Potential price scenarios:
Bearish: Trade tensions, weak US data, BTC-spot ETF outflows, and resistance to a US Crypto Strategic Reserve could drag BTC below $80K.
Bullish: Easing trade tensions, positive US data, ETF inflows, and lawmaker support for a US Crypto Strategic Reserve could drive BTC toward its record high of $109,312.
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