Bitcoin rebounded after three straight sessions of decline as markets attempted to stabilize following heightened volatility. Institutional investors withdrew nearly $970 million over four sessions, indicating reduced risk appetite ahead of key monetary policy events. July inflation readings showed PPI +0.9% m/m and core CPI +0.3% m/m, signaling persistent inflationary pressure. Retail sales growth slowed to 0.5% and consumer sentiment fell to multi-month lows, creating a Fed dilemma between controlling inflation and responding to cooling demand. Powell's Jackson Hole remarks could tilt flows; dovishness may support Bitcoin while hawkishness could prompt sharper corrections. U.S.-listed Bitcoin ETF flows remain choppy amid elevated Treasury yields that currently favor fixed income unless real yields decline.
However, capital flow data highlights growing caution: institutional outflows have totaled nearly $970 million across four straight sessions, signaling that large funds are reducing risk exposure ahead of key monetary policy events. The primary factor shaping Bitcoin's short-term outlook lies in the policy direction of the U.S. Federal Reserve (Fed). July data showed the Producer Price Index (PPI) rising sharply by 0.9% m/m, while core CPI remained elevated at +0.3% m/m-evidence that inflationary pressures have not fully eased.
At the same time, domestic consumption has begun to soften, with retail sales up only 0.5% and the University of Michigan's consumer sentiment index retreating to multi-month lows. This leaves the Fed in a dilemma: the economy is not weak enough to justify immediate rate cuts, but it is cooling sufficiently to make expectations of easing later this year appear reasonable. Against this backdrop, Fed Chair Jerome Powell's upcoming speech at the Jackson Hole Symposium is seen as a pivotal event.
Another key development is the flow of funds into U.S.-listed Bitcoin ETFs. After record inflows earlier in the year, recent data show choppy and inconsistent movements, reflecting diverging sentiment among institutional investors. With U.S. Treasury yields still elevated, many large investors continue to favor fixed-income instruments over risk assets. However, should real yields begin to decline, ETFs could swiftly reverse and attract strong inflows again, amplifying any recovery momentum in Bitcoin.
Collection
[
|
...
]