Bitcoin Climbs Above $38,000 on Rate Cut Expectations

Bitcoin climbed back above $38,000 on Tuesday amid optimism the US central bank may be closer to lowering borrowing costs if inflation continues to decline.

The largest cryptocurrency by market value gained as much as 3.2% to $38,218. Bitcoin reached an 18-month high of $38,422 on Friday. Lower rates generally increase investors’ appetite for riskier assets such as digital tokens.

Federal Reserve Governor Christopher Waller said he’s encouraged by a recent slowing of economic activity, which may indicate the central bank’s policy is tight enough.

He made the comments as part of prepared remarks Tuesday for an event at the American Enterprise Institute in Washington.

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