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Bitcoin Price Nears $71K Amid Hopes for U.S. Rate Cuts

Bitcoin’s price surged on Wednesday, driven by increasing expectations of U.S. interest rate cuts amid ongoing weak economic data. This positive trend helped Bitcoin break out of its recent trading range.

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The rise in Bitcoin also boosted broader cryptocurrency prices, with increased capital flows into the market over the past month. Additionally, the launch of spot Bitcoin exchange-traded funds (ETFs) in Australia indicated potential for more capital inflows in the near term.

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A weaker U.S. dollar this week further supported the crypto markets.

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As of 01:43 ET (05:43 GMT), Bitcoin had risen 2.7% in the past 24 hours, reaching $70,917.7.

Bitcoin Approaches Record Highs

Bitcoin, the world’s largest cryptocurrency, broke out of the $60,000 to $70,000 trading range it had been stuck in since mid-March. It is now trading approximately $3,000 shy of a new record high.

Previously, a combination of profit-taking, concerns over high interest rates, and cooling optimism regarding Bitcoin ETFs had kept Bitcoin within its trading range following a surge to record highs in early March. However, interest in cryptocurrency appears to be rising again, especially with the potential for lower interest rates this year.

Risk-heavy assets like cryptocurrencies generally benefit from lower interest rates, as increased liquidity encourages more speculative trading.

Altcoins Rally with Rate Cut Hopes

Broader altcoin prices also advanced on Wednesday, fueled by weak U.S. economic data that bolstered expectations of eventual interest rate cuts by the Federal Reserve.

Ether, the second-largest cryptocurrency, rose 0.7%, while SOL, XRP, and ADA saw gains between 0.9% and 5%.

Among meme tokens, SHIB surged 8%, and DOGE added 3.1%.

Expectations for a September rate cut increased following softer-than-expected job openings data released on Tuesday. This was preceded by weak purchasing managers index data and a downward revision of the U.S. gross domestic product for the first quarter.

Despite these readings intensifying bets on a September rate cut, market focus this week remains on upcoming nonfarm payrolls data for more definitive indicators on the labor market and future interest rates.

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