Bitcoin surged to a record high on Friday, soon after February’s US jobs report raised hopes that the Fed will start cutting its main target rate as early as June. The US Labor Department’s jobs data were a mixed bag: nonfarm payrolls rose by more than the consensus view, but the unemployment rate unexpectedly advanced, wage gains flatlined and job additions in previous months were revised down. This mixed news revived investors’ hopes of rate cuts, which are seen as necessary to deliver a so-called ‘soft-landing’ for the economy. The leading cryptocurrency is considered a great reverse trade for USD — when the dollar rises, bitcoin falls, and vice versa. This feature is becoming ever more desirable now that the US’s economic path is diverging from other advanced economies, and no major hard currency is currently able to efficiently hedge the gyrations of the USD. On top of that, the US Securities and Exchange Commission’s recent approval of eleven bitcoin exchange trade funds (ETFs) signalled mainstream acceptance of the cryptocurrency as a trading instrument, increasing demand for it in anticipation of rate cuts and a falling dollar.
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