Home » Bitcoin Bitcoin price clings to $20K as analyst says Fed ‘buried’ soft landing Reading 3 min Views 8 The U.S. inflation narrative shifts away from ease-of-control in what could further pressure risk asset performance. Bitcoin (BTC) fluctuated around the key $20,000 mark into Aug. 31 as the outlook on United States inflation darkened. Data from Cointelegraph Markets Pro and TradingView showed BTC/USD again dipping below the last halving cycle’s top overnight, only to regain lost ground to circle $20,300 on the day. The rangebound moves accompanied modest recoveries for U.S. stocks, with the S&P 500 and Nasdaq Composite Index up 0.15% and 0.6% within the first hour’s trading, respectively. Concerns over the Federal Reserve’s plans on tackling inflation after last week’s gloomy speech by Chair Jerome Powell nonetheless lingered. Despite Powell’s earlier rhetoric, Diane Swonk, chief economist at KPMG, told mainstream media that the entire concept of a “soft landing” for the U.S. economy was now shelved. Powell’s speech had in fact “buried the concept of a soft landing,” she explained to Bloomberg, and showed that the Fed instead planned to keep growth in check to “grind inflation down.” “It is a torturous process but less torturous and less painful than an abrupt recession,” Swonk added. With the mood thus firmly conservative on risk assets, attention likewise remained on the strength of the dollar as it continued to circle twenty-year highs. “For risk-on assets, including Bitcoin, it’s essential to have a stable Dollar or a weak Dollar, as upwards pressure can be expected on the markets,” Michaël van de Poppe, CEO of trading firm Eight Global, told Twitter followers. “The coming month is going to be important for the $DXY. And this potential bearish divergence could be the first signal.” U.S. dollar index (DXY) 1-hour candle chart. Source: TradingView Markets “at the craps table” over Fed rate hike September, traditionally a “red” candle month for Bitcoin, also promised an essential Fed decision on key rate hikes, along with August Non-Farm Payrolls (NFP) and Consumer Price Index (CPI) inflation data. Expectations favored a 75-basis-point hike echoing July, CME Group’s FedWatch Tool showed on the day. “Instead of looking to the broader rate path, or the terminal rate, markets are back to trading the 21 Sep FOMC odds – whether they will hike 50bp or 75bp,” trading firm QCP Capital told Telegram channel subscribers in its latest market update. “Worse still, Powell has effectively handed this policy decision to the 2 Sep NFP and the 13 Sep CPI — which basically means investors are now all at the craps table, betting on over or under.” TAdditional impetus for a larger rate hike, QCP added, could be due to the longer-than-normal gap between July’s revision and September thanks to the August lull. Normally, rate hike decisions are taken on a monthly basis. Fed target rate probabilities chart. Source: CME Group The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.