SINGAPORE – The dollar was steady on Wednesday in cautious trading ahead of US inflation data due later this week that is likely to influence the Federal Reserve’s policy, while bitcoin was volatile after a fake social media post rattled markets.
The US securities regulator said someone briefly accessed its X social media account and posted a fake message saying it had approved exchange traded funds (ETFs) for bitcoin. The Securities and Exchange Commission (SEC) said it had not yet approved spot bitcoin ETFs.
Bitcoin surged to a fresh 21-month peak of $47,897 after the fake post, before sliding down to below $45,000 within minutes as the SEC deleted and disavowed the information.
The world’s biggest cryptocurrency was last down 0.5 percent at $45,897. Anticipation of a positive SEC decision on ETFs, which is likely to draw billions in new investments, has boosted bitcoin prices in the past two months.
“The reality is most who have followed the saga have moved on and the green light from the SEC is fully priced,” said Chris Weston, head of research at Pepperstone.
Weston said the market was focused on when the various ETFs would start to trade, how many bitcoins would be held by the end of the year and the dollar value of inflows over that time.
In the currency market, the dollar remained on the front foot, with the dollar index, which measures the US currency against six rivals, last at 102.53, after gaining 0.215 percent on Tuesday.
The index is up 1 percent this month, after dropping 2 percent in December as traders reassess how steep and early the rate cuts from the Fed are likely to be.
The Fed’s surprising dovish tilt in December, when it projected 75 basis points (bps) of rate cuts in 2024, turbo-charged market expectations of easing with traders last month anticipating as much as 160 bps of cuts.
