China’s interest-rate cut pushes Bitcoin toward $100,000
On Tuesday, May 7, China's central bank unexpectedly intervened in monetary policy: the policy rate was cut by 50 basis points, and the main short-term rates were lowered by 10 basis points as well.
On Tuesday, May 7, China's central bank unexpectedly intervened in monetary policy: the policy rate was cut by 50 basis points, and the main short-term rates were lowered by 10 basis points as well. This move is pegging Beijing to pump roughly one trillion yuan into the economy — about $138 billion in current dollars, according to estimates.
“This is a clear sign that the world’s second-largest economy is grappling with liquidity issues. Markets are reacting positively to this near-term stimulus,” View post on X macro analyst EndGame Macro.
That positive reaction showed up right away in crypto: Bitcoin jumped to around $97,000, just shy of the $100,000 mark. Other crypto assets are also rallying on the news, underscoring the link between liquidity injections and riskier assets.
But there’s more. Later today, the U.S. Federal Reserve will unveil its rate decision. The market expects rates to stay at 4.50%, just like in March. A small slice of traders, about 1%, still aren’t ruling out a surprise 25-basis-point cut, especially after last week’s strong U.S. jobs data.
Investors will be keeping a close eye on Fed Chair Jerome Powell’s briefing at 8:30 p.m. ET. His remarks could move Bitcoin toward that $100,000 threshold: signal a dovish tilt and it could give the rally another nudge. If the Fed sounds hawkish, momentum could see a short-term pause.
