Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Unexpected Manufacturing Boom in March Propels US Dollar, Pushes Down Crypto

Published 04/02/2024, 09:07 AM
Updated 04/07/2022, 04:55 AM

Bitcoin and Ethereum saw significant price swings as the dollar rallied on robust US manufacturing data.

The cryptocurrency market experienced significant volatility over the past month, with Bitcoin (BTC) and Ethereum (ETH) showcasing substantial price fluctuations.

At its peak during the period, Bitcoin traded at the $73,000 level and Ethereum at the $4,000 level. Today, both cryptocurrencies saw a significant decline, with Bitcoin dropping over 5% to $66,010 at the time of writing and Ethereum to $3,336, down over 4%.

Meanwhile, the dollar index (DXY) rallied to a 4-and-a-half-month high, bolstered by a stronger-than-expected US manufacturing PMI report for March.

Bitcoin and Ethereum See Over 4% Decline

From March 2, 2024, to April 2, 2024, Bitcoin’s price ranged from a high of $73,740.9 to a low of $60,138.2. On April 2, 2024, Bitcoin’s price stood at $66,010.9, marking a change of -5.24% from the previous day.

Similarly, Ethereum’s price action was volatile, with the highest recorded price at $4,091.28 and the lowest at $3,063.60 within the same period. Ethereum experienced a notable price change of -4.75% on April 2, 2024, with the price at $3,336.30.

Dollar Index Gains After ISM Manufacturing Index Rises Higher than Expected

The February personal spending report initially supported the dollar index’s rise, and Fed Chair Powell’s comments indicated there was no rush to cut interest rates.

Gains extended with the release of the March ISM manufacturing index, which exceeded expectations, rising +2.5 to 50.3, the highest level in one and a half years. The Prices Paid sub-index also increased significantly, reaching a one-and-a-half-year high of 55.8, surpassing forecasts.

3rd party Ad. Not an offer or recommendation by See disclosure here or remove ads .

The positive ISM manufacturing index suggests a more robust economic outlook, with manufacturing activity expanding more than anticipated.

This has implications for interest rate policies, potentially affecting the Federal Reserve’s decisions on rate adjustments. The report’s influence was reflected across currency pairs, with the EUR/USD dropping to a one-and-a-half-month low and the USD/JPY rising. Following the PMI data, the dollar’s strength against a basket of major currencies was showcased.

The PMI report contributed to higher Treasury yields, indicating investors’ expectations for a tighter monetary policy in response to the robust manufacturing data. This movement in bond yields also reflects the market’s anticipation of future economic conditions and inflationary pressures.

Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.


This article was originally published on The Tokenist. Check out The Tokenist’s free newsletter, Five Minute Finance, for weekly analysis of the biggest trends in finance and technology.

Latest comments

Please spare us the Rigged data .... Manufacturing is up in BS, US does not manufacture Squat !! lol
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.