Bitcoin Holds Steady Above $104K as Bank of Japan Hikes Rates to 17-Year High
Bitcoin (BTC) remained relatively stable on Friday morning, maintaining its position above $104,000, after the Bank of Japan (BOJ) raised its benchmark interest rate to the highest level in 17 years, alongside an upward revision of inflation expectations.
The BOJ’s policy statement emphasized that if the outlook in the January Outlook Report materializes, the central bank will continue to raise interest rates and further reduce monetary accommodation. “Should the outlook be realized, the Bank will continue raising the policy interest rate and adjust the degree of monetary accommodation,” the statement indicated, according to ForexLive.
In response to the rate hike, the Japanese yen strengthened by more than 0.6%, reaching 155.12 against the U.S. dollar. Despite this, risk assets such as Bitcoin showed resilience, trading relatively unchanged above $104,000. Additionally, S&P 500 futures traded flat, reflecting a subdued market response.
This strength in risk assets suggests a shift in focus toward potential policy changes under President Donald Trump’s administration. In contrast, the BOJ’s previous rate hikes, particularly in July, had caused volatility in risk assets, including cryptocurrencies.
On Thursday, President Trump signed an executive order banning the digital dollar while simultaneously promoting innovation in cryptocurrencies and AI within the U.S. The latest U.S. data also showed a slower-than-expected rise in the all tenant rent index, which directly influences shelter inflation in the CPI, raising hopes that the Federal Reserve could dial back on its hawkish stance in the coming months.
