BREAKING: Bitcoin Rises as Fed’s Williams Eases Rate Hike and Inflation Concerns
Highlights
- New York Fed President John Williams sees trend toward lower inflation, easing rate hike concerns.
- He said long-term bond yields are rising due to a solid economy, not inflation fears.
- Bitcoin jumps above $77,000 after Williams boosts risk-on sentiment.
New York Fed’s President John Williams on Wednesday said long-term bond yields are rising due to a solid economy, not inflation fears. His wait-and-see comments on a potential rate hike provided some relief after last week’s hawkish signals from Fed Chair Kevin Warsh. This helped Bitcoin rebound back above $77,000.
Fed’s Williams Sees Strong Economy and Lower Inflation
Williams told CNBC that he sees no clear evidence yet that current policy is insufficient to bring inflation back to the 2% target. He attributed the recent Treasury bond yields primarily to a strong U.S. economy and heavy investment in AI and technology rather than inflation concerns.
He claimed high oil prices due to the U.S.-Iran war and tariffs remain key drivers of inflation. However, he noted signs of easing inflation. He added that the labor market is solid and the Fed needs more data before its next rate decision.
According to the latest CME FedWatch Tool data, traders assign roughly a 66% probability to a 25bps rate hike at the September FOMC meeting, with the chances of rates remaining unchanged rising.
Notably, odds of a rate hike surged in recent days following Fed Chair Kevin Warsh’s Jackson Hole remarks on inflation still remaining high.
The U.S. 10-year Treasury yield hovered near 4.78% after comments by Fed’s Williams, pulling back slightly from session highs near 4.81%. The US dollar index (DXY) traded around 99.55, easing from earlier levels as Fed’s Williams denied urgency for rate hikes.
Bitcoin Reclaims Above $77,000
Bitcoin jumped 1% in just an hour, with the price currently trading above $77,200. The 24-hour low and high are $76,297 and $78,137, respectively. Furthermore, trading volume has increased slightly in the last 24 hours.
CoinGlass data showed buying in the derivatives market. At the time of writing, the total Bitcoin futures open interest jumped 1% to $53.74 billion in the last 4 hours. Bitcoin futures OI on CME climbed more than 0.20% and dropped 0.14% on Binance.
Higher oil prices, rising global yields, and rate hike fears kept traders cautious on Bitcoin’s upside momentum. However, remarks by Fed’s Williams that inflation is slowly trending lower triggered some positive momentum in the crypto market.
Market participants now await US jobs, inflation data, and the September FOMC decision for clearer direction on Bitcon price.
Polymarket data shows prediction market participants expect Bitcoin price to reach $85,000 by December 31, 2026, with 62% ‘Yes’ bets.
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