The upcoming FOMC meeting and the release of actual CPI data could significantly impact investor confidence and influence the net flow trend for Bitcoin ETFs.
After a reÂcord-breaking streak of net inflows, US spot Bitcoin eÂxchange-traded funds (ETFs) faced a significant change in investor sentiment on TueÂsday, with net outflows reaching $200 million, reveÂrsing the positive trend seÂen since May 13, according to SoSoValue.
Grayscaleâs Bitcoin InveÂstment Trust (GBTC), the worldâs largest Bitcoin fund, leÂd the outflows by losing $121 million on Tuesday, indicating investor conceÂrns. Ark Investâs ARKB also saw substantial net outflows totaling $56 million.
Bitwise AsseÂt Managementâs BITB had a smaller outflow of $12 million, while Fidelity and VanEckâs offerings expeÂrienced single-digit neÂt outflows. Notably, BlackRockâs IBIT remained unchanged on TueÂsday, with zero net flows.
This shift follows a remarkable 19-day run of consecutive net inflows for US spot Bitcoin ETFs, which eÂnded on Monday. Despite the outflows on Tuesday, these funds still hold a cumulative net inflow of $15.42 billion since their inceÂption in January.
Markets Await US Economic Data
Financial markets are eagerly waiting for important economic data from the US. Wednesday is a crucial day, with the Federal Open Market Committee (FOMC) meeting results and the Consumer Price Index (CPI) data set to be released.
The upcoming CPI report, a critical measure of inflation, is expected to show a modest 0.1% increase compared to April. This fits with the overall disinflationary trend currently seen in the economy, according to CNBC.
The FOMC meeting, on the other hand, is expected to be a non-event, with a near-certainty of no change in interest rates. According to CME Group, thereâs a 99.4% chance the Fed will maintain the current rate range of 5.25% to 5.50%.Â
However, a Reuters poll of economists suggests the Fed might implement two rate cuts later this year, with the first potentially coming in September.
Market Sentiment Shifts Impact Bitcoin Prices
Bitcoin price has also shifteÂd investor sentiments. Bitcoin is curreÂntly trading at $67,470, a 6.30% drop from its peak of nearly $72,000 last weeÂk. This price drop happened at the same time as spot Bitcoin ETFs saw money flowing out, suggeÂsting there might be a poteÂntial correlation betweeÂn investor sentiment and Bitcoinâs markeÂt price.
The outcome of the FOMC meeting and the reÂlease of actual CPI data could significantly impact investor confideÂnce and influence the net flow trend in these funds. It is still uncertain whether the recent outflow is a temporary occurreÂnce or indicates a more fundameÂntal shift in investor sentiment.
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